Under very general conditions, we construct a micro-macro model for closed economy with a large number of heterogeneous agents. By introducing both financial capital (i.e. valued capital—equities of firms) and physical capital (i.e. capital goods), our framework gives a logically consistent,...

To explain the relationship between income inequality and economic growth, we develop a computational model of endogenous growth by taking the effects of fixed government expenditure into account. With such a model, a non-linear relationship between level of income inequality and economic growth...