scholarly journals Revisited: Monopoly and Long-Run Capital Accumulation in Two-Sector Overlapping Generation Model

2021 ◽  
Vol 14 (7) ◽  
pp. 304
Author(s):  
Ronald Ravinesh Kumar ◽  
Peter J. Stauvermann
Keyword(s):  
Capital Accumulation ◽  
Consumer Surplus ◽  
Real Income ◽  
Generation Model ◽  
Young Generation ◽  
The Real ◽  
Overlapping Generation ◽  
Oligopolistic Market ◽  
Long Run ◽  
Distribution Of Income

In this paper, we investigate if an increasing competition in an oligopolistic market will enhance the real incomes and consumer surplus in the long run. For this purpose, we apply a two-sector overlapping generation model in which members of the young generation own the oligopolistic firms. We show that increasing competition in the oligopolistic market leads to ambiguous outcomes regarding the real income and consumer surplus in the long run. However, we show that the distribution of income will become fairer if the competition increases, but it is possible that the price for a fairer distribution is a lower income for all members of the economy.

scholarly journals Taxation of Land and Economic Growth

Economies ◽  
2021 ◽  
Vol 9 (2) ◽  
pp. 61
Author(s):  
Shulu Che ◽  
Ronald Ravinesh Kumar ◽  
Peter J. Stauvermann
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Generation Model ◽  
Young Generation ◽  
Overlapping Generation ◽  
Land Rents ◽  
Stamp Duty

In this paper, we theoretically analyze the effects of three types of land taxes on economic growth using an overlapping generation model in which land can be used for production or consumption (housing) purposes. Based on the analyses in which land is used as a factor of production, we can confirm that the taxation of land will lead to an increase in the growth rate of the economy. Particularly, we show that the introduction of a tax on land rents, a tax on the value of land or a stamp duty will cause the net price of land to decline. Further, we show that the nationalization of land and the redistribution of the land rents to the young generation will maximize the growth rate of the economy.

scholarly journals Demographic Trends, the Dividend-Price Ratio, and the Predictability of Long-Run Stock Market Returns

2011 ◽  
Vol 46 (5) ◽  
pp. 1493-1520 ◽  
Author(s):  
Carlo A. Favero ◽  
Arie E. Gozluklu ◽  
Andrea Tamoni
Keyword(s):  
Stock Market ◽  
Stock Returns ◽  
Demographic Variable ◽  
Generation Model ◽  
Price Ratio ◽  
Market Returns ◽  
Stock Market Returns ◽  
Financial Ratio ◽  
Overlapping Generation ◽  
Long Run

AbstractThis paper documents the existence of a slowly evolving trend in the log dividend-price ratio, DPt, determined by a demographic variable, MYt: the middle-aged to young ratio. Deviations of DPtfrom this long-run component explain transitory but persistent fluctuations in stock market returns. The relation between MYtand DPtis a prediction of an overlapping generation model. The joint significance of MY and DPtin long-horizon forecasting regressions for market returns explains the mixed evidence on the ability of DPtto predict stock returns and provide a model-based interpretation of statistical corrections for breaks in the mean of this financial ratio.

scholarly journals Government Expending, Real Interest Rate, and Economic Growth in Nepal

2018 ◽  
Vol 41 (3-4) ◽  
pp. 41-57
Author(s):  
Arbind Chaudhary ◽  
Mahesh Acharya
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Causal Relationship ◽  
Real Interest Rate ◽  
Trade Openness ◽  
Government Expenditure ◽  
Real Income ◽  
The Real ◽  
Long Run ◽  
Average Rainfall

This paper aims to obtain a linear and causal relationship between government expenditure and real interest rate to the economic growth of Nepal for 1975-2015. The applied ARDL cointegration technique yields a long-run association among the variables. Furthermore, the variables: government expenditure, real interest rate, and other control variables-average rainfall and trade openness are established as long-run elements to the national income. The real interest rate has a substitution effect on the Nepalese household sector, hence it hurts the real income. However, trade openness, public expenditure, and average rainfall are recorded as the short-run determinants. Similarly, the study also explores the existence of a bidirectional causal relationship between government expenditure and real income.

scholarly journals Between communism and capitalism: long-term inequality in Poland, 1892–2015

2021 ◽  
Author(s):  
Paweł Bukowski ◽  
Filip Novokmet
Keyword(s):  
Household Survey ◽  
National Accounts ◽  
Capital Income ◽  
Sharp Rise ◽  
Long Run ◽  
History Of ◽  
Low Levels ◽  
Distribution Of Income

AbstractWe construct the first consistent series on the long-term distribution of income in Poland by combining tax, household survey and national accounts data. We document a U-shaped evolution of inequalities from the end of the nineteenth century until today: (1) inequality was high before WWII; (2) abruptly fell after the introduction of communism in 1947 and stagnated at low levels during the whole communist period; (3) experienced a sharp rise with the return to capitalism in 1989. We find that official survey-based measures strongly under-estimate the rise in inequality since 1989. Our results highlight the prominent role of capital income in driving the U-shaped evolution of top income shares. The unique inequality history of Poland speaks to the central role of institutions and policies in shaping inequality in the long run.

How Does Innovation Affect Economic Growth? Evidence from G20 Countries

2021 ◽  
pp. 001946622110635
Author(s):  
Ajoy K Sarangi ◽  
Rudra P. Pradhan ◽  
Tamal Nath ◽  
Rana P. Maradana ◽  
Hiranmoy Roy
Keyword(s):  
Economic Growth ◽  
Causal Relationships ◽  
Jel Codes ◽  
The Real ◽  
Real Effects ◽  
Long Run ◽  
Short Run ◽  
Shed Light

We study the interactions between innovation and economic growth in G20 countries over 1961–2019. We establish whether there is a temporal causality between these two variables. Employing the autoregressive distributive lag framework, our results expose a grid of short-run and long-run causal relationships between innovation and growth, including long-run unidirectional causality from innovation to economic growth. Overall, our findings shed light on the real effects of innovation on economic growth. JEL Codes: O38, O31, O32

Human capital accumulation, income distribution, and economic growth: a demand-led analytical framework

2021 ◽  
Vol 9 (3) ◽  
pp. 319-336
Author(s):  
Gilberto Tadeu Lima ◽  
Laura Carvalho ◽  
Gustavo Pereira Serra
Keyword(s):  
Human Capital ◽  
Capital Accumulation ◽  
Analytical Framework ◽  
Output Growth ◽  
Human Capital Accumulation ◽  
Capital Utilization ◽  
Tax Rate ◽  
Long Run ◽  
The Impact ◽  
Long Run Equilibrium

This paper incorporates human capital accumulation through provision of universal public education by a balanced-budget government to a demand-driven analytical framework of functional distribution and growth of income. Human capital accumulation positively impacts on workers’ productivity in production and their bargaining power in wage negotiations. In the long-run equilibrium, a rise in the tax rate (which also denotes the share of output spent in human capital formation) lowers the pre- and after-tax wage share and physical capital utilization, and thus raises (lowers) the output growth rate when the latter is profit-led (wage-led). The impact of a higher tax rate on the employment rate (which also measures human capital utilization) in the long-run equilibrium is negative (ambiguous) when output growth is wage-led (profit-led). In any case, the supply of higher-skilled workers does not automatically create its own demand.

Foreign Capital, Natural Resource Rents and Financial Development: A New Approach

2020 ◽  
pp. 097215092096136
Author(s):  
Muhammad Shahbaz ◽  
Mohammad Ali Aboutorabi ◽  
Farzaneh Ahmadian Yazdi
Keyword(s):  
Financial Development ◽  
Natural Resource ◽  
Capital Accumulation ◽  
Foreign Capital ◽  
New Approach ◽  
Resource Rents ◽  
Long Run ◽  
Natural Resource Rents ◽  
Rich Countries ◽  
The Impact

This article explores the impact of financial development on the ‘natural resources rents–foreign capital accumulation nexus’ in selected natural resource–rich countries during 1970Q1–2016Q4. In doing so, we propose a new approach by applying the autoregressive distributed lag (ARDL) rolling regression technique for our empirical purpose. The results show that financial development has a positive and significant effect on the way natural resource rents affect foreign capital in the case of Australia, Chile, Ecuador, Egypt and Peru in both the short run and the long run. We achieve the same results in the case of Colombia and Iran too, but just in the long run. Also, short-term and long-term negative effects of financial development on the rents–foreign capital nexus are witnessed just in the case of Algeria. We provide some empirical evidence for further robustness of our findings. Finally, we suggest that there is a necessity for the development of the financial system in natural resource–rich countries to reach higher levels of foreign capital, which has a crucial role in their economic growth.

scholarly journals AID AND GROWTH IN BANGLADESH: A REASSESSMENT

2018 ◽  
pp. 422-440
Author(s):  
Sharif Hossain ◽  
Rajarshi Mitra ◽  
Thasinul Abedin
Keyword(s):  
Economic Growth ◽  
Foreign Aid ◽  
Inflation Rate ◽  
Government Expenditure ◽  
Real Income ◽  
Domestic Investment ◽  
Real Gdp ◽  
Long Run ◽  
Short Run ◽  
Per Capita

Although the amount of foreign aid received by Bangladesh as a share of GDP has declined over the years, Bangladesh remains one of the heavily aiddependent countries in Asia. The results of most empirical studies that have examined the effectiveness of foreign aid or other forms of development assistance for economic growth have varied considerably depending on the econometric methodology used and the period of study. As the debate and controversy over aid-effectiveness for economic growth continue to grow, this paper reinvestigates the short-run and long-run effects of foreign aid received on percapita real income of Bangladesh over the period 1972–2015. A vector error correction model is estimated. The results indicate lack of any significant short-run and long-run relation between foreign aid and per-capita real income. Results further indicate short-run unidirectional causalities from per-capita real GDP to domestic investment (in proportion to GDP), from government expenditure (in proportion to GDP) to inflation rate, from inflation rate to domestic investment (in proportion to GDP), and from domestic investment to foreign aid (as percentages of GDP). Short-run bidirectional causality is observed between per-capita electricity consumption and per-capita real GDP, and between per-capita real GDP and government expenditure (in proportion to GDP).

scholarly journals Cotton Imports and GDP of Indonesia- Cointegration Analysis

2021 ◽  
pp. 149-154
Author(s):  
P. Soumya ◽  
R. A. Yeledhalli
Keyword(s):  
High Speed ◽  
Cointegration Analysis ◽  
Causality Analysis ◽  
The Real ◽  
Real Gdp ◽  
Use Of Technology ◽  
Long Run ◽  
Negative Effect ◽  
The Government ◽  
The Impact

The study examines the impact of cotton imports on the real GDP (Gross Domestic Product) of Indonesia for a period from 1992 to 2018 using ARDL approach and Granger causality analysis. Results of the study indicated that cotton imports have negative effect on economic growth. For every 1% increase in cotton imports the real GDP decreased by 0.107% in the long run. Any disequilibrium in the model is adjusted with a high speed of adjustment of 107.7% in less than a year. Shocks and the trend are adjusted in less than one year. There is no causality between imports of cotton and the real GDP. The study suggested effort should be taken by the government to increase yield of cotton by the use of technology and also a need to initiate farmers to take up cotton farming. 

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