Nonhomothetic preferences, growth, trade and land
AbstractNonhomothetic preferences with minimums of subsistence imply rates of investment that increasewith the level of income, and thus a positive correlation between growth rates and the level ofincome, at low levels of income. The existence of this positive correlation for a closed economywas already shown in a previous paper. The purpose of this paper is to show that, if we introduceland -a scarce resource that cannot be accumulated- in the model, this positive correlation existsfor an open economy as well.
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Bibliographic InfoPaper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie AD with number 1997-14.
Length: 2 pages
Date of creation: Apr 1997
Date of revision:
Publication status: Published by Ivie
Subsistence minimums; investment rates;
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