Income and Wealth Distribution in a Neoclassical Two-Sector Heterogeneous-Households Growth Model with Elastic Labor Supply and Consumer Durable Goods

• Main Author: Wei-Bin ZHANG
• Format: Article
• Language: English
• Published: Editura ASE 2017-06-01
• Series: Management and Economics Review
• Subjects: brand and knowledge; intangibles and capitalization; online retailing and information technology; control; significance and strategy; innovation; brand and knowledge; intangibles and capitalization; online retailing and information technology; control
• Online Access: http://mer.ase.ro/files/2017-1/9.pdf

This paper proposes a two-sector two-group growth model with elastic labor supply and consumer durable goods. We study dynamics of wealth and income distribution in a competitive economy with capital accumulation as the main engine of economic growth. The model is built on the Uzawa two-sector model. It is also influenced by the neoclassical growth theory and the post-Keynesian theory of growth and distribution. We plot the motion of the economic system and determine the economic equilibrium. We carry out comparative dynamic analysis with regard to the propensity to save and improvements in human capital and technology.