Income inequality and economic growth——the Kuznets curve revisited
In a neoclassical growth framework with a typical political-economy mechanism, this paper reexamines the relationship between the income inequality and economic growth by introducing government spending into the production function and the utility function. It demonstrates that Kuznets’ famous inver...
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Published in: | Frontiers of economics in China 2006-06, Vol.1 (2), p.196-206 |
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Main Authors: | , , |
Format: | Article |
Language: | English |
Subjects: | |
Citations: | Items that this one cites Items that cite this one |
Online Access: | Get full text |
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Summary: | In a neoclassical growth framework with a typical political-economy mechanism, this paper reexamines the relationship between the income inequality and economic growth by introducing government spending into the production function and the utility function. It demonstrates that Kuznets’ famous inverted-U shape relationship between inequality and economic growth will hold—the growth rate will be first increasing with the income inequality before the growth rate decreases with inequality. |
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ISSN: | 1673-3444 1673-3568 |
DOI: | 10.1007/s11459-006-0004-7 |