A comment on wealth inequality and endogenous growth by Byoungchan Lee

• 成果类型: Editorial Material
• 署名作者: Gu, Shijun; Jia, Chengcheng
• 署名单位: Central University of Finance & Economics; Federal Reserve System - USA; Federal Reserve Bank - Cleveland
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2022.11.006
• 发表日期: 2023
• 页码: 149-155
• 关键词: Heterogeneous-agent model; wealth inequality; aggregate consumption

摘要

How does wealth inequality affect economic growth? Byoungchan Lee answers this question by developing a heterogeneous-agent model and augmenting it with endogenous firm innovation. The novel channel is that rising wealth concentration reduces aggregate demand, which gives firms a disincentive to spend on R&D and therefore leads to slower productivity growth. In this discussion, we first explain the difference in calibration strategy between Lee's approach and the common approach in the literature, and then discuss its quantitative implications for the effect of rising inequality on aggregate consumption. (c) 2022 Elsevier B.V. All rights reserved.