We build a quantitative theory of income growth, the increase in life expectancy in the last two centuries, and the emergence and expansion of a modern health sector in the 20th century. To do so, we develop a two-sector overlapping generations model with endogenous and directed technical change in which income growth, life expectancy, and technological progress in the health sector and the final goods sector, as well as the size of the health sector and the quality and price of the goods it produces are jointly determined in general equilibrium. The model interprets the facts as three phases of a dynamic equilibrium in which households are initially poor and the quality-adjusted price of health goods is prohibitively high so that demand for health goods is zero, life is short and life expectancy stagnant. As income grows, fueled by technological progress, households start consuming basic health goods, life expectancy starts to rise, and directed technological progress eventually, with a delay of ca. 100 years, leads to the emergence and expansion of a modern health sector.

The prevalence of entrepreneurs, particularly low-productivity non-employers, declines as economies develop. We show that this decline is more pronounced for women such that gender gaps in entrepreneurship reverse with development -- with women being overrepresented in entrepreneurship in less developed economies and underrepresented in more developed economies. This paper explores whether gender asymmetries in time devoted to non-market responsibilities can explain this pattern across countries. Given the flexibility afforded to entrepreneurs, constraints on available market time can be an important factor impacting the selection into entrepreneurship, and these constraints are tighter for women, particularly in less developed economies. To quantitatively assess the importance of constraints on time use on gender gaps in entrepreneurship, we develop a general equilibrium model of occupational choice where selection into entrepreneurship depends on both ability and available time. Using a calibrated version of the model, we find that observed gender gaps in time use are crucial for explaining the observed cross-country differences in entrepreneurship by gender. Importantly, gender gaps in time use imply significant implications for cross-country aggregate outcomes, including average firm size, productivity, and output. Our results highlight the importance of factors such as child-care policy or societal norms in not only influencing gender differences in labor market outcomes

We document that senior plant managers in less-developed countries spend more time dealing with government rules and regulations than their counterparts in richer countries. We interpret these facts through the lens of a model of managerial and knowledge hierarchies, in which top managers run heterogeneous production plants, employing other managers as well as production workers. The model implies that increasing the time burden on senior management leads to equilibrium changes in wages, sorting, the size distribution of production plants and ultimately, to a reduction in aggregate output. These consequences hold even when the time burden is symmetric across all plants. We find that increasing the burden on managers' time from the levels observed in Denmark to the levels observed in Argentina reduces aggregate output by about 13% and plant size by about 3 employees on average. Overall, our results contribute to rationalizing differences in plant size and output across countries via a channel hitherto unexplored in the literature

This paper examines how the ageing of Europe and the unbalanced decay of its labour force across its labour force across education, gender and age groups has
ultimately impacted the occupational make up of its labour markets and the resulting income distribution. Our quantitative general equilibrium model explicitly considers multiple cohorts of workers that can continuously choose among skill accumulation and potentially many different occupations. Cohorts of different sizes and composition, whose life-cycle evolution of human capital are endogenously determined determines the equilibrium skill prices and the cross-section distribution of income. On the production side, a rich setting encompasses varying degrees capital-skill complementarity. and easily allows for non-neutral impacts of technological advances as well as implications of alternative labour market and other policies. The model is calibrated to the main European countries and is used to explore the impact of ageing across these countries and how it has impacted the earnings (levels and life-cycle profiles) of workers of different observed characteristics (age, education, sex, etc.) We will also explore the implications of alternative labour market policies and the consequences of automation and of immigration flows, both within Europe and with the rest of the world