Inequality, institutons and growth
AbstractThe paper explores the relationship between the distribution of wealth and income, the institutional environment and the growth rate of an economy. A formal model is developed in which the members of society determine, through a political process, the extent of property rights protection provided by its institutions. We show that the level of protection is a function of the decisive agent's property share, and that for both a political process requiring a 'strict consensus' and for one consisting in 'majority voting', improvements in the distribution of property result in more secure property rights. The model also predicts that, since increased property rights protection reduces the adverse effects of socio-political instability on savings and investment, improvements in the distribution of wealth and income also lead to higher growth rates.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by University of Chile, Department of Economics in its journal Estudios de Economia.
Volume (Year): 26 (1999)
Issue (Month): 1 Year 1999 (June)
Inequality; institutons; growth.;
You can help add them by filling out this form.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Verónica Kunze).
If references are entirely missing, you can add them using this form.