Cover Page -- Title Page -- Copyright Page -- Contents -- Introduction -- Part One: Aggregate Growth and Individual Savings -- Chapter One: Production and Distribution of Income in a Market Economy -- 1.1 Accounting -- 1.2 The Neoclassical Theory of Distribution -- Chapter Two: Exogenous Savings Propensities -- 2.1 A Linear Consumption Function -- 2.2 References and Further Issues -- Chapter Three: Optimal Savings -- 3.1 The Optimal Consumption Path -- 3.2 The Dynamics of Accumulation and Distribution -- 3.3 Welfare Distribution in Complete Markets -- 3.4 References and Further Issues -- 3.5 Appendix: HARA Preferences -- 3.6 Review Exercises -- Chapter Four: Factor Income Distribution -- 4.1 Factor Shares and Savings in Early Growth Models -- 4.2 Factor Shares in the Neoclassical Growth Model -- 4.3 Optimal Savings and Sustained Growth -- 4.4 Policy and Political Economy -- 4.5 References and Further Issues -- 4.6 Appendix: Factor Shares in a Two-Sector Growth Model -- Chapter Five: Savings and Distribution with Finite Horizons -- 5.1 Distribution and Growth in the Two-Period OLG Model -- 5.2 Inequality in a Perpetual Youth Model -- 5.3 One-Period Lifetimes and Bequests -- 5.4 References and Further Issues -- 5.5 Appendix: Consumption in the Perpetual Youth Model -- Chapter Six: Factor Shares and Taxation in the OLG Model -- 6.1 Factor Shares in the Two-Period Model -- 6.2 Factor Shares and Growth in the Perpetual Youth Model -- 6.3 References and Further Issues -- Part Two: Financial Market Imperfections -- Chapter Seven: Investment Opportunities and the Allocation of Savings -- 7.1 Decreasing Returns to Individual Investment -- 7.2 Increasing Returns and Indivisibilities -- 7.3 Endogenous Factor Prices and "Trickle-Down" Growth -- 7.4 References and Further Issues -- 7.5 Review Exercises -- Chapter Eight: Risk and Financial Markets.

8.1 Optimization under Uncertainty -- 8.2 Rate-of-Return Risk -- 8.3 Portfolio Choice and Risk Pooling -- 8.4 References and Further Issues -- 8.5 Review Exercise -- Chapter Nine: Uninsurable Income Shocks -- 9.1 A Two-Period Characterization -- 9.2 General Equilibrium: The CARA Case -- 9.3 General Equilibrium: The CRRA Case -- 9.4 Application: Uninsurable Risk in the Labor Markets -- 9.5 References and Further Issues -- Part Three: Many Goods -- Chapter Ten: Distribution and Market Power -- 10.1 Growth through Expanding Product Variety -- 10.2 Variable Elasticities of Substitution -- 10.3 Factor Shares, Taxation, and Political Economy -- 10.4 References and Further Issues -- Chapter Eleven: Indivisible Goods and the Composition of Demand -- 11.1 Income Distribution and Product Diversity -- 11.2 The Introduction of New Products -- 11.3 Inequality and Vertical Product Differentiation -- 11.4 References and Further Issues -- Chapter Twelve: Hierarchic Preferences -- 12.1 A Basic Framework -- 12.2 Growth, Distribution, and Structural Change -- 12.3 References and Further Issues -- Chapter Thirteen: Dynamic Interactions of Demand and Supply -- 13.1 Learning by Doing and Trickle-Down -- 13.2 Demand Composition and Factor Rewards -- 13.3 References and Further Issues -- Solutions to Exercises -- References -- Index.

This book looks at the distribution of income and wealth and the effects that this has on the macroeconomy, and vice versa. Is a more equal distribution of income beneficial or harmful for macroeconomic growth, and how does the distribution of wealth evolve in a market economy? Taking stock of results and methods developed in the context of the 1990s revival of growth theory, the authors focus on capital accumulation and long-run growth. They show how rigorous, optimization-based technical tools can be applied, beyond the representative-agent framework of analysis, to account for realistic market imperfections and for political-economic interactions. The treatment is thorough, yet accessible to students and nonspecialist economists, and it offers specialist readers a wide-ranging and innovative treatment of an increasingly important research field. The book follows a single analytical thread through a series of different growth models, allowing readers to appreciate their structure and crucial assumptions. This is particularly useful at a time when the literature on income distribution and growth has developed quickly and in several different directions, becoming difficult to overview.

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Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2018. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.