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Poor countries have large and unproductive rural sectors. “One prominent feature of virtually every developing country is an enormous divide between rural and urban living standards, measured by income, consumption, or various nonmonetary aspects of life.

“What drives growth in a country” has been an enduring topic in development accounting. Two things stand out in the minds of economists: for poor countries, K/Y is low and education is low.

At the dynamic interface between economics and artificial intelligence, a fascinating development is attracting the attention of researchers and practitioners alike: the use of Large Language Models (LLMs) to simulate economic agents.

The Model The model will feature the following three properties: Asymmetric The cost to decrease prices is a small constant while the cost to increase prices is positive and increasing in the size of price adjustment.

In the realm of economic steering, the Federal Reserve is no stranger to manipulating short-term interest rates. It’s like their trusty old toolbox–they’ve used it for ages to influence the economic engine.