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A two-sector growth model with institutional saving and investment

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Abstract

This paper develops a two-sector growth model in which institutional investors play a significant role. A necessary and sufficient condition is established under which these investors own the entire capital stock in the long run. The dependence of the long-run growth rate on the behaviour of such investors, and the effects of a productivity increase are analysed.

Suggested Citation

  • Donald A. R. George, 2013. "A two-sector growth model with institutional saving and investment," Edinburgh School of Economics Discussion Paper Series 214, Edinburgh School of Economics, University of Edinburgh.
    • Handle: RePEc:edn:esedps:214
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    File URL: http://www.econ.ed.ac.uk/papers/id214_esedps.pdf
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    1. Robin Marris & Adrian Wood (ed.), 1971. "The Corporate Economy," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-01110-0, December.
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    3. Christophe Hachon, 2010. "Do Beveridgian pension systems increase growth?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(2), pages 825-831, March.
    4. Nicholas Kaldor, 1966. "Marginal Productivity and the Macro-Economic Theories of Distribution: Comment on Samuelson and Modigliani," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 33(4), pages 309-319.
    5. Moss, S J, 1978. "The Post-Keynesian Theory of Income Distribution in the Corporate Economy," Australian Economic Papers, Wiley Blackwell, vol. 17(31), pages 303-322, December.
    6. Commendatore, Pasquale, 1999. "Pasinetti and Dual Equilibria in a Post Keynesian Model of Growth and Institutional Distribution," Oxford Economic Papers, Oxford University Press, vol. 51(1), pages 223-236, January.
    7. Paul A. Samuelson & Franco Modigliani, 1966. "The Pasinetti Paradox in Neoclassical and More General Models," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 33(4), pages 269-301.
    8. Bas Van Groezen & Lex Meijdam & Harrie A. A. Verbon, 2007. "Increased Pension Savings: Blessing or Curse? Social Security Reform in a Two‐Sector Growth Model," Economica, London School of Economics and Political Science, vol. 74(296), pages 736-755, November.
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    More about this item

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth

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