Spence on Development

I quote from Science magazine's review of The Next Convergence The Future of Economic Growth in a Multispeed World. This is a 2011 publication by Michael Spence:

Spence emphasizes that economic growth is tied fundamentally to innovation and knowledge. Openness to international trade and globalization is one of the strongest correlates of economic growth in the data because it facilitates access to knowledge. Imagine the standard of living in any single country if it had never encountered ideas invented elsewhere in the world.

That's what I have been saying for years in this blog. Of course, the Nobel Prize winning economist who chaired the Commission on Growth and Development and dean of Stanford University's business school, is a more credible witness to this theory.

The review also states:

Spence highlights a well-known association between urbanization and economic growth. He describes China as needing to build a new Los Angeles every year to accommodate its annual flow of 15 million people from the countryside. Yet despite three decades of such movements, more than 50 percent of China's population remains rural. The number in India is even higher, around 70 percent, and Spence suggests that India will likely experience massive urbanization in the next two decades. Echoing a point that Paul Romer has explored creatively in recent years, urban infrastructure appears to be a crucial ingredient to sustained growth.