Harvard University Professor Dani Rodrik answered readers' questions on how globalization affects developing countries' growth prospects, on what policies are most conducive to long-term growth in the global economy, and on why some governments are unable to implement them.

International outsourcing refers to the agreement where a firm contracts another firm in a foreign country to perform parts of its production process. In recent years, outsourcing has become an increasingly important economic phenomenon worldwide. The traditional view is that outsourcing induces growth, but some observers have recently pointed to it as a source of instability and increased volatility. What are the relative merits of these differing views?
Read Report

Few countries have been able to sustain the pace of China’s economic growth over the last decades. Market-friendly reforms are often indicated as the major driver of this tremendous growth. Yet there is some disagreement on how these reforms have worked: did they help large enterprises to get larger, or did they spur the foundation and growth of new, private companies?
Read Report

MIT Professor Daron Acemoglu answered readers' questions on the economic origins of political regimes, the relationship between income and democracy, the causes of long-run economic growth, and the role of institutions in the economy.

Achieving an equitable income distribution is a major concern for many governments. Especially in emerging economies, rapid growth often leads to very large income differentials across workers. This may result in social unrest. Which factors have an impact on the sharing of wealth in emerging economies? Are emerging and developed economies different in the extent to which profits are shared between workers and firms?
Read Report

The costs and benefits of the ongoing process of globalization of both industrialized and emerging economies is a hotly debated topic. What does pure economic theory have to say about it? In particular, what are the effects of globalization on the working of goods and asset markets? What happens when countries that heavily borrow on global financial markets cannot credibly commit to repay their debts?
Read Report

Reduction in trade costs is a major force behind globalization. Yet, standard economic models struggle to reconcile theory with facts. The paper inquires into the effects of globalization on individual firms, and looks at how the arrival of new competitors and the opening of new markets affect firms' size and productivity. It also looks into how globalization affects firms' stock market valuation.
Read Report

Large and efficient bond markets are a distinguishing feature of well developed financial systems, and may provide an important channel for international capital flows. What are the main factors determining bond market integration across different regions? Why are Asian markets more successful in attracting foreign investors than Latin American ones? What should policymakers do to promote the development of their country’s bond markets?
Read Report

UC Berkeley Professor Barry Eichengreen answered readers' questions on how China’s impressive growth affects the international economic and financial system, on its implications for the dollar’s exchange rate, for Asian economies, and for the IMF.

University of Chicago Professor Luigi Zingales answered readers' questions on how advances in information technology are transforming firms’ physical boundaries and the nature of knowledge-based industries, and on the implications for corporate strategy and industry policy.