Income Distribution and Macroeconomics

Oded Galor and Joseph Zeira

MPRA Paper from University Library of Munich, Germany

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 correlation 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; credit market imperfections imperfections. (search for similar items in EconPapers)
JEL-codes: O1 O10 O40 (search for similar items in EconPapers)
Date: 1988-07-01, Revised 1989-09-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Working Paper: Income Distribution and Macroeconomics (2013)
Journal Article: Income Distribution and Macroeconomics (1993)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:51644

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