Open AccessPosted Content
Inequality and Economic Growth: The Perspective of the New Growth Theories
Reads0
Chats0
TLDR
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
Citations
More filters
Journal ArticleDOI
Does Wealth Inequality Matter for Growth? The Effect of Billionaire Wealth, Income Distribution, and Poverty
Sutirtha Bagchi,Jan Svejnar +1 more
TL;DR: The authors derived a global measure of wealth inequality from Forbes magazine's listing of billionaires and compared its effect on growth to the effects of income inequality and poverty, finding that wealth inequality reduces economic growth, but when controlling for the fact that some billionaires acquired wealth through political connections, the effect of politically connected wealth inequality is negative, while politically unconnected wealth inequality, income inequality, and initial poverty have no significant effect.
Posted Content
Redistribution and Occupational Choice in a Schumpeterian Growth Model
TL;DR: In this paper, the authors consider an R&D-driven endogenous growth model in which innovation is risky and agents are risk averse, and examine the impact of redistributive taxation and compute socially optimal tax rates.
Book
Public Finance in China: Reform and Growth for a Harmonious Society
Jiwei Lou,Shuilin Wang +1 more
TL;DR: Wang et al. as discussed by the authors focused on public good aspects of education and training-compulsory education and some aspects of higher education and trained higher education, and encouraged seven reforms including raising government expenditure on education to four percent of gross domestic product (GDP), and ensuring that all children actually receive nine years of basic education.
Journal ArticleDOI
Economic growth and inequality: the role of fiscal policies*
TL;DR: In this article, the impact of different instruments of fiscal policy on economic growth as well as on income inequality was analyzed using an unbalanced panel of 43 upper-middle and high income countries for the period 1972-2006.
References
More filters
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.
Related Papers (5)
Ability Biased Technological Transition, Wage Inequality, and Economic Growth
Oded Galor,Omer Moav +1 more