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This paper investigates the link between inequality and demand for redistribution by looking at how individuals form … their perceptions of inequality. Most of the literature analyzing demand for redistribution has focused on objective … inequality, rather than subjective perceptions of inequality. However, a model that links demand for redistribution to subjective …
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consumption level. Qualitatively, an income redistribution from labor to capital leads to consumer credit dynamics that are in …
Persistent link: https://www.econbiz.de/10010417174
In this study, we set up a DSGE model with upward looking consumption comparison and show that consumption externalities are an important driver of consumer credit dynamics. Our model economy is populated by two different household types. Investors, who hold the economy's capital stock, own the...
Persistent link: https://www.econbiz.de/10012041964
Demographic differences, like young and elderly, and healthy and disabled, are summarized as consumers' heterogeneity in expenditure shares, and introduced into an otherwise standard HO model, together with income distribution in this paper. We prove that free trade may hurt consumers who spend...
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This preliminary note investigates perception bias: To what extent do individual opinions confound reality? We estimate … smartphone ownership, bootstrapped quantile regression models show that perception bias is associated with age …
Persistent link: https://www.econbiz.de/10012288913
Using a collective model of consumption, we characterize optimal commodity taxes aimed at targeting specific individuals within the household. The main message is that distortionary indirect taxation can circumvent the agency problem of the household. Essentially, taxation should discourage less...
Persistent link: https://www.econbiz.de/10013127328
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