One of the characteristic facts concerning the “catching-up countries” is the exceptionally large variation in their per capita annual rate of growth, from about zero to about 10%. The papers published in this monograph show that this rate is strongly dependent on the rate of investment, the quality of the labour force and the quality of institutions. The rate of investment is, in turn, dependent on the rate of domestic savings. In Poland, domestic savings are shown to have been and continue to be very low by international standards. The trend rate of growth of about 3.7% has been about 2 pp. higher than that of the most developed economies, mainly thanks to the development of modern market institutions and a new private sector, and partly thanks to foreign direct investments and a significant inflow of finance from the European Union (EU). The data also show that by far the least successful transformation in Eastern Europe has taken place in Ukraine.

(Author’s Introduction)

***

Our discussion is limited to the Technology Frontier Area (TFA) of the world. The central question is how the area’s innovation rate changes over time in the course of centuries. The analysis indicates that the pattern of change of the innovation rate over time may be eventually hat-shaped. This Hate-Shape Relationship is an empirical law that is given a theoretical interpretation. It is in part a prediction based on the author’s model of innovation and growth. Its acceleration and steady growth segments correspond well to the past reality. Its slowdown part is the central thesis of the book.

Stanisław Gomułka – born 1940 in Poland, MSc in theoretical physics in 1961 (with MSc work published in the Physical Review 1964), PhD in economics in 1966 from the University of Warsaw, in 1970–2005 a member of the economics department of the London School of Economics. During this period also a visiting professor at Pennsylvania University for one year, a visiting scholar at Harvard, Columbia and Stanford Universities, a research fellow at the Netherlands Institute for Advanced Studies in Wassenaar, an advisor to the IMF on Poland in 1985–87, and from 1989 through 2002 a key adviser to Polish finance ministers. Since 2013 a member of the Polish Academy of Sciences. The author of about 100 articles published in high quality journals and several books, the main ones being Inventive Activity, Diffusion, and the Stages of Economic Growth; Growth, Innovation and Reform in Eastern Europe; and The Theory of Technological Change and Economic Growth. These publications mainly deal with topics in economic growth, innovative activity, reforms in public finance, monetary policies, and comparative economic systems.

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