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Inequality, Redistribution, and Economic Growth

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  • Josef Zweimueller

Abstract

This paper provides a critical review of the recent literature on inequality and growth. After discussing historical and more recent distributional trends as well as empirical evidence on the relationship between inequality and growth, I focus on recent explanations of the inequality-growth puzzle. I consider both the impact of the functional and the personal distribution on long-run growth rates. A final section discusses a rather neglected issue in the recent literature: the impact of expected demand for innovation decisions.

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Paper provided by Institute for Empirical Research in Economics - University of Zurich in its series IEW - Working Papers with number 031.

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Handle: RePEc:zur:iewwpx:031

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Keywords: Income Distribution; Labor Share; Endogenous Growth; Demand Composition;

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Cited by:
  1. Radhika Lahiri & Elisabetta Magnani, 2008. "On inequality and the allocation of public spending," Economics Bulletin, AccessEcon, vol. 5(9), pages 1-8.
  2. Lahiri, Radhika & Ratnasiri, Shyama, 2013. "Costly technology adoption, redistribution and growth," Economic Modelling, Elsevier, Elsevier, vol. 33(C), pages 440-449.
  3. Christophe Ehrhart, 2009. "The effects of inequality on growth: a survey of the theoretical and empirical literature," Working Papers 107, ECINEQ, Society for the Study of Economic Inequality.
  4. Neugart, Michael, 2005. "Unemployment insurance: The role of electoral systems and regional labour markets," European Journal of Political Economy, Elsevier, Elsevier, vol. 21(4), pages 815-829, December.
  5. Lahiri, Radhika & Magnani, Elisabetta, 2012. "Endogenous skill heterogeneity and inflation," Economic Modelling, Elsevier, Elsevier, vol. 29(5), pages 1745-1756.
  6. Sadrieh, Abdolkarim & Verbon, Harrie A.A., 2006. "Inequality, cooperation, and growth: An experimental study," European Economic Review, Elsevier, Elsevier, vol. 50(5), pages 1197-1222, July.

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