A Theory of Endogenous Degrowth and Environmental Sustainability (with Philippe Aghion, Timo Boppart, Michael Peters, and Fabrizio Zilibotti) [Revision requested, Econometrica]
Growth can be consistent with environmental sustainability if it is directed to improving quality rather than increasing quantity. The recent rise of services reflects a transition to quality-oriented growth that may be mismeasured as a growth slowdown.
The expanding market share of modern service firms creates service-led growth in developing countries. This growth is driven by the gap in labor productivity between modern and traditional services, and is amplified by income effects on consumer demand.
Risk-sharing causes migrants to move to less productive destinations that provide a better hedge against shocks in their origin location. This effect is testable and observable in gravity equations on migration flows.
Firms Unchained: Human Capital, the Emergence of Modern Services, and 21st Century Development (with Alvaro Cox and Hannes Tepper)
An exogenous expansion of human capital unlocks service-led growth by allowing top service firms to open establishments in new locations.