Growth, Distribution and Politics

Author/Editor:

Guido Enrico Tabellini ; Torsten Persson

Publication Date:

August 1, 1991

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

We start by arguing that to understand growth differences across countries and time, one needs to understand differences in public policies that affect the incentives for productive accumulation of capital, human capital, or technically useful knowledge. And to understand policy differences one needs to understand how political institutions aggregate conflicting interests into public policies. We then survey some recent work along these lines, which argues that more inequality leads to slower growth. Next, we illustrate some of the basic ideas of this work, by help of a simple model of taxation. We also present some econometric cross-country evidence, which is largely supportive of the basic ideas. We end by suggestions for further work.

Series:

Working Paper No. 1991/078

Subject:

English

Publication Date:

August 1, 1991

ISBN/ISSN:

9781451850031/1018-5941

Stock No:

WPIEA0781991

Pages:

19

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