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| Type | Working Paper |
| Scope | Discipline-based scholarship |
| Title | Income Distribution and Demand-induced Innovations |
| Organization Unit | |
| Authors |
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| Language |
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| Institution | University of Zurich |
| Series Name | Working paper series / Institute for Empirical Research in Economics |
| Number | No. 212 |
| ISSN | 1424-0459 |
| Date | 2004 |
| Abstract Text | "We utilize Schmookler’s (1966) concept of demand-induced invention to study the rolenof income inequality in an endogenous growth model. As rich consumers can satisfy morenwants than poor consumers, both prices and market sizes for new products, as well as theirnevolution over time, are determined by the income distribution. We show how a change in the distribution of income affects the incentive to innovate and hence long-run growth. In general, less inequality tends to discourage the incentive to innovate, but this depends on the nature of the redistribution." |
| Official URL | http://www.econ.uzh.ch/wp.html |
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