Growth and inequality: Dependence on the time path of productivity increases (and other structural changes)

Manoj Atolia (), Santanu Chatterjee () and Stephen J Turnovsky

Journal of Economic Dynamics and Control, 2012, vol. 36, issue 3, 331-348

Abstract: This paper examines the significance of the time path of a given productivity increase on growth and inequality. Whereas the time path impacts only the transitional paths of aggregate quantities, it has both transitional and permanent consequences for wealth and income distribution. Hence, the growth–inequality tradeoff generated by a given discrete increase in productivity contrasts sharply with that obtained when the same productivity increase occurs gradually. The latter can generate a Kuznets-type relationship between inequality and per-capita income. Our results suggest that economies with similar aggregate structural characteristics may have different outcomes for income and wealth inequality, depending on the nature of the productivity growth path.

Keywords: Growth; Inequality; Path dependence (search for similar items in EconPapers)
JEL-codes: D31 O41 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165188911001643
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Growth and Inequality: Dependence of the Time Path of Productivity Increases (and other Structural Changes) (2009)
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:eee:dyncon:v:36:y:2012:i:3:p:331-348

DOI: 10.1016/j.jedc.2011.08.012

Access Statistics for this article

Journal of Economic Dynamics and Control is currently edited by J. Bullard, C. Chiarella, H. Dawid, C. H. Hommes, P. Klein and C. Otrok

More articles in Journal of Economic Dynamics and Control from Elsevier
Bibliographic data for series maintained by Catherine Liu ().