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There is now a consensus that economic growth is a dominant determinant of poverty. That is, poverty reduction requires sustained economic growth significantly above the population growth so that per capita income continues to rise. Economic growth raises mean income and reduces the proportion...
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Originally appeared in the Federal Reserve Bank of Philadelphia Business Review, September 1973, p. 16-25
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Preferences over wealth can explain why households do not spend more when real interest rates fall, because they save … more than optimal under a standard model. However, little is known about preferences over wealth empirically. We run an … wealth, consistent with wealth entering the utility function directly. …
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