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Inequality and Economic Growth: The Perspective of the New Growth Theories
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This paper analyzed the relationship between inequality and economic growth from two directions, showing that when capital markets are imperfect, there is not necessarily a trade-off between equity and efficiency, and provided an explanation for two recent empirical findings, namely, the negative impact of inequality and the positive effect of redistribution upon growth.Abstract:
We analyze the relationship between inequality and economic growth from two directions. The first part of the survey examines the effect of inequality on growth, showing that when capital markets are imperfect, there is not necessarily a trade-off between equity and efficiency. It therefore provides an explanation for two recent empirical findings, namely, the negative impact of inequality and the positive effect of redistribution upon growth. The second part analyzes several mechanisms whereby growth may increase wage inequality, both across and within education cohorts. Technical change, and in particular the implementation of "General Purpose Technologies," stands as a crucial factor in explaining the recent upsurge in wage inequality.read more
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Online Appendix to: The Composition Effects of Tax-Based Consolidations on Income Inequality
TL;DR: In this paper, the authors investigated the effects of tax-based consolidation on income inequality, output and labour market conditions for a sample of 16 OECD countries over the period 1978-2012.
Essays on Political Economy and Economic Development
TL;DR: The spillover of information from more developed economies to the less developed nations is of key importance for sustainable transition towards higher living standards in emerging societies as mentioned in this paper, and the amount and type of essential information which is transferred to developing world is far from being exhausted by technological spillover effect.
Posted Content
One or many Kuznets curves? Short and long run effects of the impact of skill-biased technological change on income inequality
TL;DR: The authors studied the impact of skill-biased technological change on the growth path and income distribution of a developing economy and found that a scenario of catching-up to the high-growth steady state is predictable for those economies starting off with a high enough endowment of skilled workforce.
Posted Content
The Question of Economic Convergence - first part -
TL;DR: In this article, the authors deal with the economic convergence of the European countries, and especially the convergence of CEE countries, including Romania, and assess the economic growth, approximate the period of real convergence of Romania to the EU, as well as to estimate the s- and s-convergence, and the main shortcomings of the last indicator.
Book ChapterDOI
Reforming Welfare States
TL;DR: The authors survey the literature on welfare state reform in the EU and argue that the often postulated trade-off between efficiency and equality does not apply in general and that countries looking for growth-friendly social policies should primarily focus providing equal opportunities and avoid exclusion or discrimination on the basis of gender, ethnicity or other characteristics.
References
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Report SeriesDOI
Initial conditions and moment restrictions in dynamic panel data models
Richard Blundell,Stephen Bond +1 more
TL;DR: In this paper, two alternative linear estimators that are designed to improve the properties of the standard first-differenced GMM estimator are presented. But both estimators require restrictions on the initial conditions process.
The mechanics of economic development
Abstract: This paper considers the prospects for constructing a neoclassical theory of growth and international trade that is consistent with some of the main features of economic development. Three models are considered and compared to evidence: a model emphasizing physical capital accumulation and technological change, a model emphasizing human capital accumulation through schooling, and a model emphasizing specialized human capital accumulation through learning-by-doing.
Journal ArticleDOI
Legal Determinants of External Finance
TL;DR: The authors showed that countries with poorer investor protections, measured by both the character of legal rules and the quality of law enforcement, have smaller and narrower capital markets than those with stronger investor protections.
Journal ArticleDOI
An Exploration in the Theory of Optimum Income Taxation
TL;DR: In this paper, the authors make the following simplifying assumptions: (1) Intertemporal problems are ignored; (2) the tax system that would bring about that result would completely discourage unpleasant work; and (3) what such a tax schedule would look like; and what degree of inequality would remain once it was established.
Journal ArticleDOI
Income Distribution and Macroeconomics
Oded Galor,Joseph Zeira +1 more
TL;DR: The authors analyzes the role of wealth distribution in macroeconomics through investment in human capital and shows that the initial distribution of wealth affects aggregate output and investment both in the short and in the long run, as there are multiple steady states.
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