15 Years of New Growth Economics: What Have We Learnt

is now fifteen years old. This pathbreaking contribution led to a resur-gence in research on economic growth. The resulting literature has had a number of important impacts. In particular, it shifted the re-search focus of macroeconomists. From the time when Lucas, Barro, Prescott, and Sargent led the rational expectations revolution until Romer, Barro, and Lucas started the new literature on economic growth, macroeconomists devoted virtually no effort to the study of long-run issues; they were all doing research on business cycle theory. In this sense, the new growth theory represented a step in the right direction. The new growth literature has had a similar impact on macroeco-nomics classes and textbooks. Until 1986, most macroeconomics classes and textbooks either relegated economic growth to a marginal role or neglected it altogether. Things are very different now. Modern under-graduate textbooks devote more than a third of their space to economic growth, and both graduate and undergraduate macroeconomics classes devote a substantial amount of time to this important subject. The impact of these two changes on the training of young economists is very important, and this should be viewed as another contribution of the new economic growth literature. The contributions I wish to highlight in this conference, however, are the substantial ones: I want to discuss the most significant ways in which the new economic growth literature has expanded our under-standing of economics. I thank Laila Haider for her comments