Endogenous Distribution, Politics, and the Growth-Equity Tradeoff
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.
Volume (Year): 4 (2004)
Issue (Month): 1 (July)
|Contact details of provider:|| Web page: http://www.degruyter.com|
|Order Information:||Web: http://www.degruyter.com/view/j/bejm|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Satya P. Das, 1999.
"Endogeneous Distribution and the Political Economy of Trade Policy,"
Departmental Working Papers
199913, Rutgers University, Department of Economics.
- Das, Satya P., 2001. "Endogenous distribution and the political economy of trade policy," European Journal of Political Economy, Elsevier, vol. 17(3), pages 465-491, September.
- Kiminori Matsuyama, 2000.
Review of Economic Studies,
Oxford University Press, vol. 67(4), pages 743-759.
- Oded Galor & Joseph Zeira, 1993.
"Income Distribution and Macroeconomics,"
Review of Economic Studies,
Oxford University Press, vol. 60(1), pages 35-52.
- Loury, Glenn C, 1981. "Intergenerational Transfers and the Distribution of Earnings," Econometrica, Econometric Society, vol. 49(4), pages 843-67, June.
- Kristin J. Forbes, 2000. "A Reassessment of the Relationship between Inequality and Growth," American Economic Review, American Economic Association, vol. 90(4), pages 869-887, September.
- Galor, Oded & Moav, Omer, 2001.
"Das Human Kapital,"
CEPR Discussion Papers
2701, C.E.P.R. Discussion Papers.
- Jones, Larry E & Manuelli, Rodolfo E, 1990. "A Convex Model of Equilibrium Growth: Theory and Policy Implications," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 1008-38, October.
When requesting a correction, please mention this item's handle: RePEc:bpj:bejmac:v:contributions.4:y:2004:i:1:n:6. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla)
If references are entirely missing, you can add them using this form.