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Occupational Choice and the Growth-Inequality Relationship

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  • H. Lloyd-Ellis

Abstract

This paper examines the impact of education and occupational choice on the growth-inequality relationship. Occupations that play asymmetric roles in the production process are distinguished. The dynamic evolution of the detrended distribution of income is characterized and shown to converge to an endogenous, non-degenerate, stationary distribution. The long-run growth rate converges to a simple function of stuctural and fiscal parameters and the Lorenz curve describing long-run inequality. The impact of government policy on the growth-inequality relationship and welfare is assessed. The analysis is sensitive to whether we consider the short- or long- run effects and to whether redistribution takes place via taxation, expenditure or fiscal incentive schemes.

Suggested Citation

  • H. Lloyd-Ellis, 1995. "Occupational Choice and the Growth-Inequality Relationship," Working Papers lloydell-95-02, University of Toronto, Department of Economics.
    • Handle: RePEc:tor:tecipa:lloydell-95-02
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    References listed on IDEAS

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    Cited by:

    1. Takashi Kamihigashi & John Stachurski, 2011. "Stability of Stationary Distributions in Monotone Economies," ANU Working Papers in Economics and Econometrics 2011-561, Australian National University, College of Business and Economics, School of Economics.
    2. Takashi Kamihigashi & John Stachurski, 2012. "Existence, Uniqueness and Stability of Stationary Distributions: An Extension of the Hopenhayn-Prescott Theorem," Discussion Paper Series DP2012-27, Research Institute for Economics & Business Administration, Kobe University.

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    More about this item

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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