- NONHOMOTHETIC PREFERENCES, GROWTH, TRADE AND LAND

E. Cristina Echevarria

Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

Abstract: Nonhomothetic preferences with minimums of subsistence imply rates of investment that increasewith the level of income, and thus a positive correlation between growth rates and the level ofincome, at low levels of income. The existence of this positive correlation for a closed economywas already shown in a previous paper. The purpose of this paper is to show that, if we introduceland -a scarce resource that cannot be accumulated- in the model, this positive correlation existsfor an open economy as well.

Keywords: Subsistence Minimums; Investment Rates. (search for similar items in EconPapers)
Date: 1997-04

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Persistent link: http://EconPapers.repec.org/RePEc:ivi:wpasad:1997-14

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