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Inflation and income inequality in a variety-expansion growth model with menu costs

Inflation and income inequality in a variety-expansion growth model with menu costs
Inflation and income inequality in a variety-expansion growth model with menu costs
This study explores the effect of inflation on income inequality in a growth model with variety expansion and menu costs. Inflation is found to determine income inequality via both asset-value and interest-rates effects. Our numerical analyses show that higher inflation turns these effects negative,stifling economic growth and mitigating income inequality.
Income inequality, Inflation, Menu costs, Variety expansion
0165-1765
Zheng, Zhijie
7d6cc2fe-b460-46ef-8ff8-bfa2445b2862
Mishra, Tapas
218ef618-6b3e-471b-a686-15460da145e0
Yang, Yibai
6beee584-445d-4ded-8fb6-4da0c6f41910
Zheng, Zhijie
7d6cc2fe-b460-46ef-8ff8-bfa2445b2862
Mishra, Tapas
218ef618-6b3e-471b-a686-15460da145e0
Yang, Yibai
6beee584-445d-4ded-8fb6-4da0c6f41910

Zheng, Zhijie, Mishra, Tapas and Yang, Yibai (2020) Inflation and income inequality in a variety-expansion growth model with menu costs. Economics Letters, 194, [109373]. (doi:10.1016/j.econlet.2020.109373).

Record type: Article

Abstract

This study explores the effect of inflation on income inequality in a growth model with variety expansion and menu costs. Inflation is found to determine income inequality via both asset-value and interest-rates effects. Our numerical analyses show that higher inflation turns these effects negative,stifling economic growth and mitigating income inequality.

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Inflation-Inequality-Eco Let
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Accepted/In Press date: 30 June 2020
e-pub ahead of print date: 3 July 2020
Published date: September 2020
Additional Information: https://doi.org/10.1016/j.econlet.2020.109373
Keywords: Income inequality, Inflation, Menu costs, Variety expansion

Identifiers

Local EPrints ID: 442686
URI: http://eprints.soton.ac.uk/id/eprint/442686
ISSN: 0165-1765
PURE UUID: 9d9078f2-3866-465c-8ea8-c8a90974f7ac
ORCID for Tapas Mishra: ORCID iD orcid.org/0000-0002-6902-2326

Catalogue record

Date deposited: 23 Jul 2020 16:31
Last modified: 28 Apr 2022 05:53

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Contributors

Author: Zhijie Zheng
Author: Tapas Mishra ORCID iD
Author: Yibai Yang

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