Innovation and Inequality in a Monetary Schumpeterian Model with Heterogeneous Households and Firms
Angus Chu,
Guido Cozzi,
Haichao Fan,
Yuichi Furukawa and
Chih-Hsing Liao
MPRA Paper from University Library of Munich, Germany
Abstract:
This study develops a Schumpeterian growth model with heterogeneous households and heterogeneous firms to explore the effects of monetary policy on innovation and income inequality. Household heterogeneity arises from an unequal distribution of wealth. Firm heterogeneity arises from random quality improvements and a cost of entry. We find that under endogenous firm entry, inflation has inverted-U effects on economic growth and income inequality. We also calibrate the model for a quantitative analysis and find that the model is able to match the growth-maximizing inflation rate and the inequality-maximizing inflation rate that we estimate using cross-country panel data.
Keywords: inflation; income inequality; economic growth; heterogeneity (search for similar items in EconPapers)
JEL-codes: D3 E41 O3 O4 (search for similar items in EconPapers)
Date: 2018-02
New Economics Papers: this item is included in nep-dge, nep-ino, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)
Downloads: (external link)
https://mpra.ub.uni-muenchen.de/84711/1/MPRA_paper_84711.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/86530/1/MPRA_paper_86530.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/90475/1/MPRA_paper_90475.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/92536/1/MPRA_paper_92536.pdf revised version (application/pdf)
Related works:
Journal Article: Innovation and Inequality in a Monetary Schumpeterian Model with Heterogeneous Households and Firms (2019) 
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:pra:mprapa:84711
Access Statistics for this paper
More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().