Full Description
What drives the long-term development of economies—and how does growth affect different segments of society?
This book redefines the theory of economic growth by moving beyond the traditional "average citizen" model. Instead, it introduces a dynamic framework that accounts for the diverse structure of real-world economies, dividing households into distinct groups based on income, consumption, and wealth.
Through rigorous modeling and analysis, the book explores how key factors—such as the economic growth rate and the return on capital—shape not only the overall trajectory of an economy but also the fortunes of its individual household groups. It demonstrates that when the return on capital exceeds the growth rate, wealth concentration intensifies—a finding that aligns with Thomas Piketty's influential empirical research. This book will appeal to economists, policymakers, and anyone interested in the forces that shape prosperity and inequality in modern societies.
Contents
Part I. Continuous-Time Circular Flow Models.- Chapter 1. Introduction: Standard Growth Models.- Chapter 2. The Circular Flow Model Without State.- Chapter 3. The Circular Flow Model with Constant Parameters.- Chapter 4. Lorenz Curves and Gini Coefficients.- Part II. Discrete-Time Circular Flow Models.- Chapter 5. The Discretized Circular Flow Model.- Chapter 6. The Circular Flow Economy with Constant Parameters.- Chapter 7. Rules for the Discretized Circular Flow Model.- Chapter 8. The Circular Flow Model with State.
