New Empirical Methods and Simulation Techniques
Edited by Pier Paolo Saviotti
Chapter 9: Twin Peaks: What the Knowledge-based Approach Can Say about the Dynamics of the World Income Distribution
9. Twin peaks: what the knowledgebased approach can say about the dynamics of the world income distribution Andreas Pyka, Jens J. Krüger and Uwe Cantner 1. INTRODUCTION Nicholas Kaldor introduced in 1961 so-called stylized facts into growth theory which represent qualitative characteristics of time series of economic variables, such as per capita production, capital coeﬃcient, capital intensity and so on. The trend in those data series and the correlations among them are described as a pattern of empirical regularities which should be the main focus of any growth theories, and their ability to provide an explanation for these facts is considered as a performance test. Among Kaldor’s list of stylized facts there is one of particular interest for this chapter: the growth rate of labour productivity is widely dispersed geographically. Only recently, out of new growth theory, has another stylized fact been added which is quite related. Romer (1989) adds that the growth of production cannot be solely explained by an increase in labour and capital input. For both of these stylized facts it is by no means farfetched to regard technological progress as a main determinant. A new stylized fact of economic growth has only recently been introduced into this discussion: the bimodal shape of the distribution of per capita income or the twin-peaked nature of that distribution. This observation suggests that the economies of the world can be divided into two groups: a group with high income – especially the industrialized countries – and one with low income...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.