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dc.contributor.authorBandyopadhyay, Debasis
dc.contributor.authorTang, Xueli
dc.date.accessioned2018-02-13T12:54:34Z
dc.date.available2018-02-13T12:54:34Z
dc.date.issued2018
dc.identifier.urihttp://hdl.handle.net/11073/9184
dc.description.abstractWe suggest that as social cohesion improves, the macroeconomic gains from progressive redistribution decline. Social interactions facilitate diffusion of nonrival knowledge. The consequent bridging of the knowledge gaps makes learning cheaper for children with limited access to adults with high human capital and thereby lowers the optimal progressivity for a redistributive policy. If social cohesion exceeds a critical threshold then zero progressivity would be optimal. Numerically, a country with greater social cohesion finds smaller gains in growth, efficiency, and welfare from progressive redistribution over and above the gains from a Pigouvian subsidy that eliminates the inefficiency caused by knowledge externalities.en_US
dc.language.isoen_USen_US
dc.publisherAmerican University of Sharjahen_US
dc.relation.ispartofseriesSchool of Business Administration Working Paper Seriesen_US
dc.subjectKnowledge Disseminationen_US
dc.subjectCES Aggregatoren_US
dc.subjectEndogenous Growthen_US
dc.subjectProgressivityen_US
dc.subjectDynamic Macroeconomic Cost-Benefit Tradeoffen_US
dc.titleSocial Cohesion and Optimal Redistribution in Economies with Long-Run Growthen_US
dc.typeWorking Paperen_US


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