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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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The Links between Finance and Inequality: Channels and Evidence
TL;DR: In this article, the authors focus on the relationship between inequality and finance and show that a better financial system can help overcome barriers, and thereby increase economic growth and reduce inequality, and that financial reform will only reduce inequality if it improves access for more individuals with growth opportunities.
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Low fertility and long run growth in an economy with a large public sector
TL;DR: In this paper, an agent-based simulation model is used to investigate the effect of social interaction on fertility and dependency ratios in a low fertility country, where the adaptation of social norms turns out to disarm the fertility trap.
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Beyond the Washington consensus: what do we mean?
TL;DR: In this article, the authors highlight the need to overcome the fundamental problems of the "Washington Consensus" that have not been entirely solved in its recent reformulations calling for a "second generation of reforms."
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Globalisation, Liberalisation, Poverty and Income Inequality in Southeast Asia
TL;DR: Malaysia, Thailand and Indonesia have been touted as models for other developing countries of how liberalisation can bring faster growth and greater equity as mentioned in this paper, but their performance has been mixed and often inferior to other Asian economies, notably in structural change, tax reform, industrialisation, education and democratisation.
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Corporate governance, firm performance, and economic growth – theoretical analysis
Marinko Škare,Tea Hasić +1 more
TL;DR: In this paper, a consistent literature review assessing the nexus between corporate performance and economic growth is presented, showing that corporate governance in majority of the cases positively affects firms performance and in turn nations' economic growth.
References
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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.
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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.
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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.
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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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