Growth and Inequality in an Experimental AK Model

Ferruccio Ponzano and Roberto Ricciuti
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Ferruccio Ponzano: University of Eastern Piedmont

Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, 2018, vol. 4, issue 2, No 4, 313-330

Abstract: Abstract In this paper we test the AK model of growth with laboratory experiments. In each period, agents produce and trade output in a market, and allocate it to consumption and investment. The economy should experience a constant and positive rate of growth. We analyze two treatments differing from technology. We find evidence of positive and constant growth, and the treatment with a better technology exhibits higher growth. Although subjects start the experiments with the same endowments, we find that this growth process is fueled by large inequalities.

Keywords: Endogenous growth; Capital accumulation; Inequality; Heterogeneity; Experiments (search for similar items in EconPapers)
JEL-codes: C91 C92 O41 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s40797-017-0066-y

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