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dc.contributor.authorSHAKHNOV, Kirill
dc.date.accessioned2014-11-11T15:57:29Z
dc.date.available2014-11-11T15:57:29Z
dc.date.issued2014
dc.identifier.issn1725-6704
dc.identifier.urihttp://hdl.handle.net/1814/33454
dc.description.abstractThe rapid growth of the US financial sector has driven policy debate on whether it is socially desirable. I propose a heterogeneous agent model with asymmetric information and matching frictions that produces a tradeoff between finance and entrepreneurship. By becoming bankers, talented individuals efficiently match investors with entrepreneurs, but do not internalize the negative effect on the pool of talented entrepreneurs. Thus, the financial sector is inefficiently large in equilibrium, and this inefficiency increases with wealth inequality. The model explains the simultaneous growth of wealth inequality and finance in the US, and why more unequal countries have larger financial sectors.en
dc.format.mimetypeapplication/pdf
dc.language.isoenen
dc.relation.ispartofseriesEUI ECOen
dc.relation.ispartofseries2014/13en
dc.rightsinfo:eu-repo/semantics/openAccessen
dc.rightsinfo:eu-repo/semantics/openAccess
dc.subjectTalenten
dc.subjectFinancial sectoren
dc.subjectMatchingen
dc.subjectProductivityen
dc.subjectE44en
dc.subjectG14en
dc.subjectL26en
dc.subjectO15en
dc.titleThe allocation of talent : finance versus entrepreneurshipen
dc.typeWorking Paperen
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