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Inequality and Economic Growth: The Perspective of the New Growth Theories
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
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Income Inequality and Growth: a Panel Study of Swedish Counties 1960-2000
TL;DR: This paper explored the relationship between income inequality and growth using panel data on Swedish counties from 1960-2000 and found a significant positive impact of inequality on growth, but the magnitude of the effect decreases with the length of the growth period studied.
Fighting inequalities in health and income - One important road to welfare and social development : Social Policy in a Development Context
J. Fritzell,O. Lundberg +1 more
TL;DR: In this article, the authors propose a social policy in a development context to fight inequalities in health and income, which is one of the most important road to welfare and social development.
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Income-related children’s health inequality and health achievement in China
Lu Chen,Ya Wu,Peter C. Coyte +2 more
TL;DR: Evidence is provided that average health status of Chinese children has improved, but inequality has widened, and that Widening inequality slowed the growth in health achievement for children over time.
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International knowledge spillovers and wage inequality in developing countries
TL;DR: In this article, international knowledge spillovers are incorporated in a horizontal innovation model, designed to explain the observed uncertain effects that openness of trade can have on wage inequality in small developing countries.
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Tracking positive and negative effects of inequality on long-run growth
TL;DR: In this paper, the authors review the theory and the evidence of the transmission channels through which inequality influences growth and use a system of recursive equations, following a control function approach, to empirically assess the relevance of these channels and differentiate between two different forms of inequality.
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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.
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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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