Income Distribution and Macroeconomics

Oded Galor and Joseph Zeira

No 2013-12, Working Papers from Brown University, Department of Economics

Abstract: This paper analyzes the role of income distribution in macroeconomic analysis. The study demonstrates that the long-run equilibrium depends on the initial distribution of income. In accordance with empirical evidence concerning the conelation between income distribution and output, an economy that is characterized by a relatively equal distribution of wealth is likely to be wealthier in the long run. The study may, therefore, provide an additional explanation for the persistent differences in per-capita output across countries. Furthermore, the paper may shed light on cross-countries differences macroeconomic adjustment to aggregate shocks.

Keywords: Wealth distribution; income distribution; growth; capital market imperfections (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-mac
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Citations: View citations in EconPapers (28)

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Related works:
Journal Article: Income Distribution and Macroeconomics (1993)
Working Paper: Income Distribution and Macroeconomics (1989)
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Persistent link: https://EconPapers.repec.org/RePEc:bro:econwp:2013-12

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