Improvement in Information, Income Inequality, and Growth

Bernhard Eckwert and Itzhak Zilcha

No 17, Econometric Society 2004 Latin American Meetings from Econometric Society

Abstract: We analyze the importance of information about individual skills for understanding economic growth and income inequality. The paper uses the framework of an OLG economy with endogenous investment in human capital. Agents in each generation differ by random individual ability, or talent, which realizes in the second period of life. The human capital of an agent depends on both his talent and his investment in education. The investment decision is based on a public signal (test outcome) which screens all agents for their talents. We analyze how a better information system, which allows more efficient screening, affects the co-movements of indicators for income inequality and human capital accumulation

Keywords: Information system; human capital accumulation; income inequality (search for similar items in EconPapers)
JEL-codes: D80 J24 J30 (search for similar items in EconPapers)
Date: 2004-08-11
References: Add references at CitEc
Citations:

Downloads: (external link)
http://repec.org/esLATM04/up.30497.1079434500.pdf (application/pdf)

Related works:
Working Paper: Improvement in Information, Income Inequality, and Growth (2004)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecm:latm04:17

Access Statistics for this paper

More papers in Econometric Society 2004 Latin American Meetings from Econometric Society Contact information at EDIRC.
Bibliographic data for series maintained by Christopher F. Baum ().