This book is an extension of three lectures presented as the first set of “Centro Interuniversitario Crescita & Sviluppo Economico (CICSE) Lectures on Growth and Development” in Lucca, Italy, in July 2007. When I was invited to present this series, I was delighted that CICSE asked me to lecture on capital accumulation and economic growth in a small open economy. Both international macroeconomics and the theory of economic growth have interested me for a long period, so this seemed like a good opportunity to discuss them in a unified way. Over the past two decades economic growth has evolved into an enormous area of research, drawing increasingly on contributions from other areas of economics, as well as from other disciplines. The approach I adopt in these lectures is a traditional one, extending the standard models of capital accumulation to the open economy.

The lectures and this resulting short book draw heavily on research that I have undertaken in this area since the mid 1990s. At the appropriate places in each chapter, I have indicated the original source of the research from which the presentation has been adapted, although in many cases the material has been extensively revised. As will be seen from the appropriate references much of the research has been undertaken jointly and I am grateful to have had the opportunity to work with many talented coauthors over the years.