A heterogeneous-agent model of growth and inequality for the UK- do planning and infrastructure matter? A supplementary note

Minford, Patrick ORCID: https://orcid.org/0000-0003-2499-935X and Zhu, Zheyi 2025. A heterogeneous-agent model of growth and inequality for the UK- do planning and infrastructure matter? A supplementary note. Open Economies Review 10.1007/s11079-025-09843-3

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Abstract

This paper builds on Yang et al. (Open Econ Rev 32(1):37–69, 2021) which analysed the effect of wealth inequality on UK economic growth in recent decades with a heterogeneous-agent growth model where agents can enhance individual productivity growth by undertaking entrepreneurship. In this supplementary note we examine whether ease of planning and infrastructure spending also contribute to productivity growth, as argued by some policymakers. The model is estimated and tested by indirect inference. The original model was not rejected in its match to the data behaviour. We find the enhanced model contributes no improvement of the match. The model with only planning and infrastructure is strongly rejected.

Item Type:	Article
Date Type:	Published Online
Status:	In Press
Schools:	Schools > Business (Including Economics)
Publisher:	Springer
ISSN:	0923-7992
Date of First Compliant Deposit:	9 January 2026
Date of Acceptance:	11 November 2025
Last Modified:	09 Jan 2026 14:30
URI:	https://orca.cardiff.ac.uk/id/eprint/183760

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