Immiserizing growth in a closed economy

Kala Krishna, Cemile Yavas

Research output: Contribution to journalArticle

1 Scopus citations

Abstract

We develop a model with three key features: a factor market distortion, monopoly power in the product market and indivisibilities in consumption. In this setting, multiple equilibria arise, one with high and the other with low equilibrium wages, incomes and output. It is also shown that even in a closed economy, growth may be immiserizing and, finally, that redistribution could be a "rich man's game".

Original languageEnglish (US)
Pages (from-to)143-158
Number of pages16
JournalScandinavian Journal of Economics
Volume106
Issue number1
DOIs
StatePublished - May 25 2004

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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