How much does inequality matter for the business cycle and vice versa? Using a Bayesian likelihood approach, we … income risk and taxes. We find that adding data on inequality does not materially change the estimated shocks and frictions … income inequality. The systematic components of monetary and fiscal policy are important for inequality as well. …

How to explain rising income and wealth inequality? We build an original heterogeneous-agent model with three key … changes in markups, taxes, factor productivity, and asset prices affect inequality dynamics over the 1984-2018 period. Rising … markups account for the bulk of rising income inequality. Wealth inequality dynamics result mostly from changes in saving rate …

in the population, these savings externalities may contribute to inequality. Working with an open economy heterogenous … increase wealth inequality between the groups and within the group of the non-university educated households. We further find …

wealth inequality. Using estimates of the earnings processes for each group to calibrate the model, we find wealth inequality … within and between the groups that is consistent with the data. Moreover, the predictions for overall wealth inequality are … heterogeneity generates a between-group pecuniary externality which in turn leads to the predicted differences in wealth inequality …

main patterns of inequality, between and within the social groupings. We find that the effects of peer pressure on within …-group inequality differ between groups. We also find that wealth and consumption inequality increase within groups who aspire to match … social targets from a higher class, despite a reduction in within-group inequality in hours and earnings. …

heterogeneity. When altruism heterogeneity is low, income inequality follows an inverse U-shaped pattern relative to the level of … altruism, which is consistent with the cross-country Kuznets curve. When altruism heterogeneity is high, income inequality … linking economic growth and income inequality. …

save dynastically and middle income households who save for retirement. We find that inequality is reduced the higher the … efficiency and inequality: middle income households' consumption is maximal at a higher capital tax rate than high income …

We propose a theory of indebted demand, capturing the idea that large debt burdens by households and governments lower … aggregate demand, and thus natural interest rates. At the core of the theory is the simple yet under-appreciated observation … a two-agent overlapping-generations model, we find that recent trends in income inequality and financial liberalization …

among the wealthy, while owner-occupied housing is crucial for middle groups, so higher stock prices raise wealth inequality … while house price increases do the opposite. Inheritances exacerbate absolute wealth inequality but reduce rel …-ative inequality. Wealth inequality declined in advanced Western countries during the first half of the 20th century, then stabilized …