Development, Preference Change, and Inequality in an Integrated Walrasian-General-Equilibrium and Neoclassical-Growth Theory

2015 ◽  
Vol 4 (3) ◽  
pp. 41-55
Author(s):  
Wei-Bin Zhang
Keyword(s):  
General Equilibrium ◽  
Growth Theory ◽  
Preference Change ◽  
Neoclassical Growth Theory ◽  
Neoclassical Growth

scholarly journals Economic Growth and Inequality with Tourism in an Integrated Walrasian-General Equilibrium and Neoclassical-Growth Theory

2018 ◽  
Vol 21 (1) ◽  
pp. 17-36
Author(s):  
Wei-Bin Zhang
Keyword(s):  
Economic Growth ◽  
General Equilibrium ◽  
Open Economy ◽  
Nonlinear Differential Equations ◽  
Small Open Economy ◽  
Growth Theory ◽  
Traded Goods ◽  
The Rich ◽  
Neoclassical Growth Theory ◽  
Neoclassical Growth

Abstract This paper studies dynamic interdependence between economic growth, tourism, and inequalities in income and wealth in a small open economy. We build the dynamic model in an integrated Walrasian-general equilibrium and neoclassical-growth theory for a small open economy with multiple sectors and heterogeneous households in a perfectly competitive economy. The economy consists of one service sector which supplies non-traded services and one industrial sector which produces traded goods. We treat wealth accumulation and land distribution between housing and supply of services as endogenous variables. We show that the motion of the economy with J types of households is given by J nonlinear differential equations. We simulate the motion of the system with three groups of households. We also conduct comparative dynamic analysis with regards to the rate of interest, the price elasticity of tourism, the global economic condition, and the rich class’ human capital, and the rich class’ propensity to consume housing.

scholarly journals Land Value and Rent Dynamics in an Integrated Walrasian General Equilibrium and Neoclassical Growth Theory

2014 ◽  
Vol 61 (2) ◽  
pp. 235-258
Author(s):  
Wei-Bin Zhang
Keyword(s):  
Human Capital ◽  
General Equilibrium ◽  
Dynamic Analysis ◽  
Growth Model ◽  
Growth Theory ◽  
Land Value ◽  
The Rich ◽  
Neoclassical Growth Theory ◽  
Neoclassical Growth

Abstract This paper is concerned with relationship between growth and land value change. It builds a heterogeneous-households growth model with endogenous wealth accumulation and fixed nondepreciating asset (land) in an integrated Walrasian general equilibrium and neoclassical growth theory. The production side consists of one service sector and one industrial sector. We use an alternative utility function proposed by Zhang, which enable us to develop a dynamic growth model with genuine heterogeneity. The wealth and income inequality is due to household heterogeneity in preferences and human capital as well as the households’ initial wealth. This is different from the standard Ramsey-type heterogeneous-households growth models, for instance, by Turnovsky and Garcia-Penalosa (2008), where agents are heterogeneous only in their initial capital endowment, not in preference or/and human capital. We build a model for any number of types of household and provide a computational procedure for simulating model. For illustration we simulate the model for the economy with three types of households. We simulate the motion of the national economy and carry out comparative dynamic analysis. The comparative dynamic analysis provides some important insights. For instance, as the rich group increases its propensity to save, the GDP and land value are increased. In the long term the group accumulates more wealth, consumes more goods and services and accumulates more wealth. But in the long term the other two groups suffer from the rich households’ preference change as their lot sizes, consumption levels of services and goods, and wealth are all reduced.

scholarly journals Fashion and Business Cycles with Snobs and Bandwagoners in a Multi-Sector Growth Model

2017 ◽  
Vol 2 (3) ◽  
Author(s):  
Wei-Bin Zhang
Keyword(s):  
Business Cycles ◽  
Growth Model ◽  
Wealth Distribution ◽  
Growth Theory ◽  
Preference Change ◽  
Dynamic Growth ◽  
Income And Wealth Distribution ◽  
Independent Parameters ◽  
Neoclassical Growth Theory ◽  
Neoclassical Growth

<p>This paper generalizes the dynamic growth model with interactions between fashion, economic growth and income and wealth distribution recently built by Zhang (2016). The modelling of fashion and preference change is inspirited by the economic model of fashion recently published by Giovinazzo and Naimzada (2015). This study introduces fashion into neoclassical growth theory. The original model is based on some ideas in the literature of economics of fashion. This study generalizes Zhang’s model by making all the time-independent parameters as time-dependent parameters. We simulate the motion of the economic system. We carry out comparative dynamic analysis with regard to periodic perturbations in some parameters. We show how exogenous period changes in these parameters lead to business cycles. </p>

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