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Inequality amongst the wealthiest and its link with economic growth

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  • Philip Hans Franses
  • Stephanie Vermeer

Abstract

In this article, we correlate the key features of the distribution of wealth of the 500 wealthiest individuals in the Netherlands with economic growth and stock market returns for the period 1998 to 2009. We show that each year the distribution obeys a power law and that the key parameter measures the degree of inequality. Our main finding is that more inequality amongst the wealthiest is associated with higher economic growth.

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  • Philip Hans Franses & Stephanie Vermeer, 2012. "Inequality amongst the wealthiest and its link with economic growth," Applied Economics, Taylor & Francis Journals, vol. 44(22), pages 2851-2858, August.
    • Handle: RePEc:taf:applec:44:y:2012:i:22:p:2851-2858
    DOI: 10.1080/00036846.2011.566211
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    1. Castaldi, Carolina & Milakovic, Mishael, 2007. "Turnover activity in wealth portfolios," Journal of Economic Behavior & Organization, Elsevier, vol. 63(3), pages 537-552, July.
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    6. Barro, Robert J, 2000. "Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
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