Understanding the economic dynamics behind growth-inequality relationships

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dc.contributor.author Bandyopadhyay, Debasis en
dc.contributor.author Tang, X en
dc.date.accessioned 2012-02-27T02:07:51Z en
dc.date.issued 2011 en
dc.identifier.citation Journal of Macroeconomics 33(1):14-32 2011 en
dc.identifier.issn 0164-0704 en
dc.identifier.uri http://hdl.handle.net/2292/12092 en
dc.description.abstract In this paper, a dynamic general equilibrium (DGE) model of growth–inequality relationships, with missing credit markets, knowledge spillover and self-employed agents, is calibrated to New Zealand data. The model explains how two distinct policy shocks involving redistribution and immigration imply, subsequently, two completely opposite outcomes. Agents’ inability to borrow aggravates a negative macroeconomic effect of heterogeneity on growth. Redistribution mitigates that effect but creates microeconomic disincentives on saving and work-effort. Consequently, immigration shocks that perturb variance of efficiency induce a negative growth–inequality relationship, while redistribution shocks, in New Zealand’s case, produce larger fluctuations in incentives than in macro benefits, implying a positive growth–inequality relationship. en
dc.publisher Elsevier Inc. en
dc.relation.ispartofseries Journal of Macroeconomics en
dc.rights Items in ResearchSpace are protected by copyright, with all rights reserved, unless otherwise indicated. Previously published items are made available in accordance with the copyright policy of the publisher. Details obtained from http://www.sherpa.ac.uk/romeo/issn/0164-0704/ en
dc.rights.uri https://researchspace.auckland.ac.nz/docs/uoa-docs/rights.htm en
dc.title Understanding the economic dynamics behind growth-inequality relationships en
dc.type Journal Article en
dc.identifier.doi 10.1016/j.jmacro.2010.06.001 en
pubs.issue 1 en
pubs.begin-page 14 en
pubs.volume 33 en
dc.rights.holder Copyright: Elsevier Inc. en
pubs.end-page 32 en
pubs.publication-status Published en
dc.rights.accessrights http://purl.org/eprint/accessRights/RestrictedAccess en
pubs.subtype Article en
pubs.elements-id 98042 en
pubs.org-id Business and Economics en
pubs.org-id Economics en
pubs.record-created-at-source-date 2010-09-01 en

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