Income Distribution and Macroeconomics
Oded Galor and
Joseph Zeira
The Review of Economic Studies, 1993, vol. 60, issue 1, 35-52
Abstract:
This paper analyzes the role of wealth distribution in macroeconomics through investment in human capital. It is shown that in the presence of credit markets' imperfections and indivisibilities in investment in human capital, the initial distribution of wealth affects aggregate output and investment both in the short and in the long run, as there are multiple steady states. This paper therefore provides an additional explanation for the persistent differences in per-capita output across countries. Furthermore, the paper shows that cross-country differences in macroeconomic adjustment to aggregate shocks can be attributed, among other factors, to differences in wealth and income distribution across countries.
Date: 1993
References: Add references at CitEc
Citations: View citations in EconPapers (2663)
Downloads: (external link)
http://hdl.handle.net/10.2307/2297811 (application/pdf)
Access to full text is restricted to subscribers.
Related works:
Working Paper: Income Distribution and Macroeconomics (2013) 
Working Paper: Income Distribution and Macroeconomics (1989) 
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:oup:restud:v:60:y:1993:i:1:p:35-52.
Access Statistics for this article
The Review of Economic Studies is currently edited by Thomas Chaney, Xavier d’Haultfoeuille, Andrea Galeotti, Bård Harstad, Nir Jaimovich, Katrine Loken, Elias Papaioannou, Vincent Sterk and Noam Yuchtman
More articles in The Review of Economic Studies from Review of Economic Studies Ltd
Bibliographic data for series maintained by Oxford University Press ().