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How innovation and heterogenous human capital shape wealth and income inequality

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  • Luca Spinesi

Abstract

Thispaperstudieshowinteractionsbetweenheterogeneoushouse- holdsintermsofsharesofwealthowned,sharesofhumancapitaland sharesofconsumptioninuencewealthandincomeinequalityinanin- novationdrivengrowthmodelwithendogenousmarketstructure.Inno- vationandworkforceskillupdatingjointlydeterminelong-runeconomic growth,whilepatentpolicygeneratesnon-monotonicdistributionalef- fects.Moderateincreasesinpatentbreadthraise rmsvaluationsand dampenswealthandincomeinequality,whereasstrongpatentprotection increaseswealthandincomeinequality.Incontrast,greatertimedevoted toskillupdatingunambiguouslyfostersinnovationandlong-rungrowth, butalsoincreaseswealthandincomeinequality.Themodeliscalibrated toU.S.dataandshowntoreplicatekeyfeaturesofthejointevolutionof wealthandincomeinequalityovertheperiod1989-2019.

Suggested Citation

  • Luca Spinesi, "undated". "How innovation and heterogenous human capital shape wealth and income inequality," Departmental Working Papers of Economics - University 'Roma Tre' 0290, Department of Economics - University Roma Tre.
    • Handle: RePEc:rtr:wpaper:0290
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    Keywords

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    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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