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The distribution of wealth in the neoclassical growth model

The distribution of wealth in the neoclassical growth model The current issue and full text archive of this journal is available at www.emeraldinsight.com/1753-8254.htm Neoclassical EDUCATION BRIEFING growth model The distribution of wealth in the neoclassical growth model Subrata Guha School of Social Sciences, CESP, Jawaharlal Nehru University, New Delhi, India 1. Introduction Market economies are generally associated with the institutions of private property and inheritance. The institution of private inheritance of wealth has often been criticized as violating principles of justice or fairness. For example, the winner of the Nobel Prize in economics in 1986, Buchanan (1986) has argued that the differences allowed in the amounts of wealth inherited by individuals in a pure market economy (with a minimal state) violate ordinary notions of fairness. Allowing such differences is akin to advantaging some individuals relative to others at the beginning of a game in which all individuals must, of necessity, participate. Similarly, the fact that the amounts of wealth inherited by different individuals cannot be related to any measure of merit attaching to their behaviour, i.e. to how ‘‘deserving’’ individuals are, has been adduced to argue that the institution violates the principle of ‘‘justice as desert’’. Mechanisms designed to modify the working of this institution – the taxation http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Indian Growth and Development Review Emerald Publishing

The distribution of wealth in the neoclassical growth model

Indian Growth and Development Review , Volume 3 (1): 11 – Apr 20, 2010

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References (10)

Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
1753-8254
DOI
10.1108/17538251011035891
Publisher site
See Article on Publisher Site

Abstract

The current issue and full text archive of this journal is available at www.emeraldinsight.com/1753-8254.htm Neoclassical EDUCATION BRIEFING growth model The distribution of wealth in the neoclassical growth model Subrata Guha School of Social Sciences, CESP, Jawaharlal Nehru University, New Delhi, India 1. Introduction Market economies are generally associated with the institutions of private property and inheritance. The institution of private inheritance of wealth has often been criticized as violating principles of justice or fairness. For example, the winner of the Nobel Prize in economics in 1986, Buchanan (1986) has argued that the differences allowed in the amounts of wealth inherited by individuals in a pure market economy (with a minimal state) violate ordinary notions of fairness. Allowing such differences is akin to advantaging some individuals relative to others at the beginning of a game in which all individuals must, of necessity, participate. Similarly, the fact that the amounts of wealth inherited by different individuals cannot be related to any measure of merit attaching to their behaviour, i.e. to how ‘‘deserving’’ individuals are, has been adduced to argue that the institution violates the principle of ‘‘justice as desert’’. Mechanisms designed to modify the working of this institution – the taxation

Journal

Indian Growth and Development ReviewEmerald Publishing

Published: Apr 20, 2010

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