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Economic size and debt sustainability against Piketty's capital inequality

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  • cho, hyejin

Abstract

This article presents a methodology designed to facilitate alternative variables measuring economic growth. A capital-labor split of Cobb-Douglas function is adapted for use in the context of economic growth. A capital/income ratio and two fundamental laws of capitalism originated by Thomas Piketty illustrate capital inequality undervalued with respect to labor inequality. In addition, the article includes export and external debt as strong alternatives. Empirical data of the World Bank are analyzed to demonstrate broad differences in economic sizes. The case analysis on Latin America as an example of different sized economy is also discussed

Suggested Citation

  • cho, hyejin, 2015. "Economic size and debt sustainability against Piketty's capital inequality," MPRA Paper 72532, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:72532
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    References listed on IDEAS

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    1. Arndt, H. W., 1985. "The origins of structuralism," World Development, Elsevier, vol. 13(2), pages 151-159, February.
    2. Thomas Perreault & Patricia Martin, 2005. "Geographies of Neoliberalism in Latin America," Environment and Planning A, , vol. 37(2), pages 191-201, February.
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    Cited by:

    1. Yasunori Fujita, 2015. "A new look at fiscal sustainability: an attempt to reveal the relationship between the sustainability of external debt and the inequality," Economics and Business Letters, Oviedo University Press, vol. 4(4), pages 161-165.

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    More about this item

    Keywords

    capital-labor split; factors of production; capital/income ratio; Thomas Piketty; capitalism; economic size; debt sustainability; Latin America; import substitution industrialization (ISI) model; insolvent external debt; openness; external debt to exports ratio;
    All these keywords.

    JEL classification:

    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • G00 - Financial Economics - - General - - - General
    • G01 - Financial Economics - - General - - - Financial Crises
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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