When central banks announce cuts to future interest rates, the expected costs of government debt service decrease, generating additional resources in future budgets. This paper demonstrates that if the rational-expectations assumption is dropped, fiscal authority can exploit those gains by...

In this paper we examine the role of intergenerational transfers in the wealth accumulation of Italian households. Received transfers represent an important share of the net wealth held by households. Direct estimates referring to 2002 range from 30 to 55 per cent, depending on the inclusion of...

Income drops permanently after an involuntary job displacement, but it has never been clear what happens to long-run wealth in the United States. This paper concludes that involuntary job displacement has large effects on wealth throughout a worker's lifetime. Upon displacement, wealth falls 14%...

The hypothesis is that Pareto and Kaldor-Hicks Efficiency have an aspect of sustainability in relation to inequality. The analysis finds efficient situations reached increasing inequality as diminishing in the long term effective demand in a larger measure than counterbalancing increases thanks...

This paper presents a review of foreign studies analyzing the role of entrepreneurs in the accumulation and distribution of wealth and approaches to modeling entrepreneurship as an integral part of the economy for evaluating the consequences of alternative economic policies. According to the...

This paper presents a dynamic competitive equilibrium model in which heterogeneity in time preferences alone can generate the observed patterns of wealth and income inequality in the United States. This model generalizes the standard deterministic neoclassical growth model by introducing (i) a...

This paper analyzes the connection between time preference heterogeneity and economic inequality. To achieve this, we extend the standard neoclassical growth model by introducing three additional features, namely (i) heterogeneity in consumers' discount rates, (ii) direct preferences for wealth,...

This paper discusses the links between earnings, consumption and economic welfare inequality. It places emphasis on the role of leisure and labor supply in the assessment of cross-household inequality and argues that the documented increase of such inequality has its origin in the labor market....

We extend one of the main findings in Bossmann et al. (2007)("Bequests, taxation and the distribution of wealth in a general equilibrium model," Journal of Public Economics, 91, 1247-1271). Bequest motives per se reduce wealth inequality. We show that the result holds for a stronger criterion of...

This paper examines the connection between time preference heterogeneity and economic inequality in a deterministic environment. Specifically, we extend the standard neoclassical growth model by introducing three additional features, namely (i) heterogeneity in consumers' discount rates, (ii)...