European Bank for Reconstruction and Development

About: European Bank for Reconstruction and Development is a other organization based out in London, United Kingdom. It is known for research contribution in the topics: Competition (economics) & Debt. The organization has 183 authors who have published 517 publications receiving 29966 citations. The organization is also known as: EBRD.

Inequality and Economic Growth: The Perspective of the New Growth Theories

Abstract: We analyze the relationship between inequality and economic growth from two directions. The first part of the survey examines the effect of inequality on growth, showing that when capital markets are imperfect, there is not necessarily a trade-off between equity and efficiency. It therefore provides an explanation for two recent empirical findings, namely, the negative impact of inequality and the positive effect of redistribution upon growth. The second part analyzes several mechanisms whereby growth may increase wage inequality, both across and within education cohorts. Technical change, and in particular the implementation of "General Purpose Technologies," stands as a crucial factor in explaining the recent upsurge in wage inequality.

A Theory of Trickle-Down Growth and Development

Abstract: This paper develops a model of growth and income inequalities in the presence of imperfect capital markets, and it analyses the trickle-down effect of capital accumulation. Moral hazard with limited wealth constraints on the part of the borrowers is the source of both capital market imperfections and the emergence of persistent income inequalities. Three main conclusions are obtained from this model. First, when the rate of capital accumulation is sufficiently high, the economy converges to a unique invariant wealth distribution. Second, even though the trickle-down mechanism can lead to a unique steady-state distribution under laissez-faire, there is room for government intervention: in particular, redistribution of wealth from rich lenders to poor and middle-class borrowers improves the production efficiency of the economy both because it brings about greater equality of opportunity and also because it accelerates the trickle-down process. Third, the process of capital accumulation initially has the effect of widening inequalities but in later stages it reduces them: in other words, this model can generate a Kuznets curve.

An incomplete contracts approach to financial contracting

Abstract: We analyze incomplete long-term financial contracts between an entrepreneur with no initial wealth and a wealthy investor. Both agents have potentially conflicting objectives since the entrepreneur cares about both pecuniary and non-pecuniary returns from the project while the investor is only concerned about monetary returns. We address the questions of (i) whether and how the initial contract can be structured in such a way as to bring about a perfect coincidence of objectives between both agents (ii) when the initial contract cannot achieve this coincidence of objectives how should control rights be allocated to achieve efficiency? One of the main results of our analysis concerns the optimality properties of the (contingent) control allocation induced by standard debt financing.

Inequality and Economic Growth: The Perspective of the New Growth Theories

Abstract: Depuis plus d'un siecle, l'une des principales preoccupations des chercheurs en sciences humaines est l'etude des origines de l'inegalite et de la facon dont celle-ci perdure. Pourtant on est encore loin d'avoir eclairci les relations entre l'inegalite et le processus de developpement economique. Ces quarante dernieres annees notamment auront ete marquees par une vision economique conventionnelle erronee sur deux points. Sur l'effet de l'inegalite sur la croissance dans les economies de marche, l'argument standard est que l'inegalite est un facteur d'incitation et de ce fait un atout pour la croissance, bien qu'il puisse y avoir un arbitrage entre, d'un cote, les considerations d'incitation et de croissance, et, de l'autre, les considerations d'equite et d'assurance. Inversement, sur les relations de causalite de la croissance a l'inegalite, la vision economique conventionnelle voudrait que l'inegalite obeisse a l'hypothese dite de Kuznets selon laquelle l'inegalite de revenu et le PNB par habitant ont une relation de forme cloche. L'objectif de cette etude est de remettre en question cette vision, contredite par les resultats de travaux empiriques recents. L'introduction d'autres aspects tels les imperfections du marche du credit, l'alea moral, le changement technique et organisationnel non neutre, et les institutions du marche du travail, donne une image plus complexe, et sans doute plus realiste, des relations entre inegalite et croissance.

The Management of Innovation

Abstract: The paper analyzes the organization of the RD (b) to rationalize commonly observed features in research employment contracts, such as shop rights, trailer clauses, and the "hired for" doctrine; (c) to discuss the robustness of the so-called Schumpeterian hypotheses to endogenizing the organization of RD and (d) to provide a rationale for cofinancing arrangements in research activities.