Recent studies (Galor and Zeira (1993), Banerjee and Newman (1993)) argue that, because of capital market imperfections, income inequality leads to inefficiencies which impede economic growth. By contrast, Keynes believed that since the rich save at a higher rate than the poor, income inequality...

We present a model that links the division of labor and economic growth with the division of wealth in society. When capital market imperfections restrict the access of poor households to capital, the division of wealth affects individual incentives to invest in specialization. In turn, the...

There is a widespread perception that trust and social capital have declined in United States as well as other advanced economies, while income inequality has tended to increase. While previous research has noted that measured trust declines as individuals become less similar to one another,...

This paper demonstrates that women search longer for their first or second husband in cities with higher male wage inequality, and examines several alternative explanations. A causal link is established by controlling for city fixed effects and city-specific time trends, and by using inequality...