This paper shows that dynamic inefficiency can occur in dynamic general equilibrium models with fully optimizing, infinitely-lived households even in a situation with underinvestment. We identify necessary conditions for such a possibility and illustrate it in a standard R&D-based growth model....

My thesis is centered on the macroeconomic causes and consequences of income inequality. The first two essays develop theoretical frameworks to analyze the impact of income inequality on technical change and long-term economic growth. These essays sprung from the very fruitful collaboration with...