Growth or Stagnation: Economic Consequences of Status Preference

Yoshiyasu Ono

ISER Discussion Paper from Institute of Social and Economic Research, The University of Osaka

Abstract: Using a dynamic optimization model with status preference this paper shows that depending on the object of people's status preference an economy exhibits a completely opposite performance; permanent growth or persistent stagnation. If the object is a producible asset (viz. real capital), new employment is created and extra production is invested in capital, which generates permanent growth even under decreasing returns to capital. If it is an unproducible asset (viz. money), commodity demand is not created and deflation occurs. Full employment is never reached under nominal wage sluggishness although prices and wages continue to adjust.

Date: 2001-01
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2001/dp0524.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dpr:wpaper:0524

Access Statistics for this paper

More papers in ISER Discussion Paper from Institute of Social and Economic Research, The University of Osaka Contact information at EDIRC.
Bibliographic data for series maintained by Librarian ().