Transitional Growth with Increasing Inequality and Financial Deepening

@inproceedings{Ueda2001TransitionalGW,
  title={Transitional Growth with Increasing Inequality and Financial Deepening},
  author={Kenichi Ueda},
  year={2001}
}
We study models that display growth with financial deepening and increasing inequality along the way to perpetual steady state growth. A benchmark model is essentially a complete markets model but with transaction costs of financial intermediation. New proofs are required and thus provided for stochastic dynamic programming for the case of unbounded return functions and perpetual growth with a non-convex transaction technology. We calibrate the model and report quantitative predictions for… CONTINUE READING

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