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Endogenous Distribution, Politics, and the Growth-Equity Tradeoff
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Satya P Das
Published/Copyright:
July 8, 2004
Abstract
In comparison to the standard literature on inequality and growth which assumes the former to be exogenous, we formulate a model in which inequality and growth are both endogenous. Long-run distribution, at least locally, is shown to be independent of the initial distribution of factor ownership. It is shown that exogenous policy changes that are primarily targeted towards growth and foster less inequality do enhance growth. But policies that are primarily redistributive and imply a more equal distribution reduce growth. This is consistent with recent empirical work which shows that inequality and growth may be positively related.
Keywords: Median Voter; Endogenous Growth; Wealth Distribution; Distributive Conflict; Redistributive Policy
Published Online: 2004-07-08
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
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Keywords for this article
Median Voter;
Endogenous Growth;
Wealth Distribution;
Distributive Conflict;
Redistributive Policy
Articles in the same Issue
- Advances Article
- Price Stability and Monetary Policy Effectiveness when Nominal Interest Rates are Bounded at Zero
- Contributions Article
- Aggregate Price Changes and Dispersion: A Comparison of the Equity and Goods and Services Markets
- Dissemination of Technology in Market and Planned Economies
- Interest-Rate Smoothing: Monetary Policy Inertia or Unobserved Variables?
- Is the U.S. Aggregate Production Function Cobb-Douglas? New Estimates of the Elasticity of Substitution
- What Does It Take to Explain Procyclical Productivity?
- Endogenous Distribution, Politics, and the Growth-Equity Tradeoff
- Explaining Speculative Expansions
- Tariffs, Entry Regulation and Markups: Country Size Matters
- Schumpeterian Growth, North-South Trade and Wage Rigidity
- Do Federal Reserve Policy Surprises Reveal Superior Information about the Economy?
- Bailouts and Bank Runs in a Model of Crony Capitalism
- Multiple Equilibria in Heterogeneous Expectations Models
- Topics Article
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- Labor Market Performance and Flexibility: Which Comes First?
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- Strictly Endogenous Growth with Non-renewable Resources Implies an Unbounded Growth Rate
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- Intergenerational Habits, Fiscal Policy, and Welfare
- Output Composition of the Monetary Policy Transmission Mechanism in Japan
- Socio-Cultural Variables and Economic Success: Evidence from Italian Provinces 1951-1991
- Monetary Policy and the Information Content of the Yield Spread
- The Dynamics of Fertility and Growth: Baby Boom, Bust and Bounce-Back
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