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We analyze inefficiency and inequality associated with the use of creative capital to produce a final good. We first study a case in which the creative capital units are perfect substitutes in the production of the final good. We show that the equilibrium outcome is inefficient and that there is...
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We analyze inefficiency and inequality associated with the use of creative capital to produce a final good. We first study a case in which the creative capital units are perfect substitutes in the production of the final good. We show that the equilibrium outcome is inefficient and that there is...
Persistent link: https://www.econbiz.de/10012986624
analysis focuses on two cases. The first (second) case concerns the impact of faster neutral (non-neutral) productivity growth … whether or not faster productivity growth in the tradable sector results in the departure of creative people from this sector … to the non-tradable sector is independent of whether this faster productivity growth is neutral or non-neutral. In …
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