Essays on investment, growth and income distribution

In this dissertation, I examine both theoretically and empirically the relationship between stock prices and income distribution using an endogenous growth model with social status impatience.^ The theoretical part looks into how status impatience and current economic status jointly determine time preference, savings, future economic status, stock prices, growth and wealth distribution in the steady state. This work builds on Burgstaller and Karayalcin (1996).^ More specifically, I look at (i) the effects of the distribution of status impatience levels on the distribution of steady state assets, incomes and consumption and (ii) the effects of changes in relative levels of status impatience on stock prices. Therefore, from (i) and (ii), I derive the correlation between stock prices, incomes and asset distribution. Also, the analysis of the stack market is undertaken in the presence of adjustment costs to investments.^ The empirical chapter looks at (i) the correlation between income inequality and long run economic growth on the one hand and (ii) the correlation between stock market prices and income inequality on the other. The role of stock prices and social status is examined to better understand the forces that enable a country to grow overtime and to determine why output per capita varies across countries. The data are from Summers and Heston (1988), Barro and Wolf (1989), Alesina and Rodrik (1994), Global financial Database (1997) and the World Bank. Data for social status are collected through a primary sample survey on the internet. Twenty-five developed and developing countries are included in the sample.^ The model developed in this study was specified as a system of simultaneous equations, in which per capita growth rate and income inequality were endogenous variables. Additionally, stock price index and social status measures were also incorporated. The results indicate that income inequality is inversely related to economic growth. In addition, increase in income inequality arising from higher stock prices constrains growth. Moreover, where social status is determined by income levels, it influences long run growth. Therefore, these results support findings of Persson and Tabellini (1994) and Alesina and Rodrik (1994). ^

Social support, risk, and adjustment of immigrant preadolescents

The current study was designed to explore the salience of social support, immigrant status, and risk in middle childhood and early adolescence across two time periods as indicated by measures of school adjustment and well-being. Participants included 691 children of public elementary schools in grades 4 and 6 who were interviewed in 1997 (Time 1) and reinterviewed two years later (Time 2); 539 were U.S.-born, and 152 were foreign-born. ^ Repeated measures multivariate analyses of variance (MANOVA's) were conducted to assess the effects of immigrant status and risk on total support, well-being, and school adjustment from Time 1 to Time 2. Follow-up analyses, including Student-Newman-Keuls post hoc tests, were used to test the significance of the differences among the means of support categories (low and high), immigrant status (U.S. born and non-U.S. born), risk (low and high) and time (time 1 and time 2). ^ Results showed that immigrant participants in the high risk group reported significantly lower levels of support than their peers. Further, children of low risk at Time 2 indicated the highest levels of support. Second, immigrant preadolescents, preadolescents who reported low levels of social support, and preadolescents of the high risk reported lower levels of emotional well-being. There was also an interaction of support by risk by time, indicating that children who are at risk and had low levels of social support reported more emotional problems at Time 1. Finally, preadolescents who are at risk and preadolescents who reported lower levels of support were more likely to show school adaptation problems. Findings from this study highlight the importance of a multivariable approach to the study of support, emotional adjustment, and academic adjustment of immigrant preadolescents. ^