Abstract
When agents have identical tastes and productivity, can choose unincorporated or corporate firms that can adopt technologies with increased productivity with delays in production, the choice of firm determines the relationship between economic growth and income inequality. For unincorporated firms as technology changes from primitive to advanced, the optimal choice change from no growth and income equality, to inefficient growth and income inequality, with no incentive to incorporate unless the technology is advanced. Corporations will rationally adopt advanced technologies causing efficient growth and income equality. Corporate market capitalism is efficient/fair. However, income inequality appears to be an irrational policy goal.
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