In this book, Nobel laureate Robert Lucas brings together his work on economic growth, from his seminal paper “On the Mechanics of Economic Development” to the previously unpublished 1997 Simon Kuznets Lectures.

Lucas moves from a general theory of how economic growth can be sustained and why growth rates may differ across countries to an explanation of the sudden spurt in growth at the start of the Industrial Revolution and a forecast of growth patterns in the 21st century. Lucas emphasizes the importance of both physical and human capital accumulation, showing the positive externalities of human capital such as the diffusion of new knowledge or on-the-job training. The Simon Kuznets Lectures focus on the interaction between human capital growth and the demographic transition in the early stages of industrialization. In the final chapter, Lucas uses a diffusion model to illustrate the possibility that the large income inequalities created by the Industrial Revolution have peaked and that income differences will gradually narrow in the 21st century.