In recent years, there has been increasing interest in understanding the determinants of income inequality across countries. There have also been concerns about the degree of concentration in the banking system on economic activity. Yet, there has not been any work which focuses on the level of...

In recent years, there has been increasing interest in understanding the determinants of income inequality across countries. There have also been concerns about the degree of concentration in the banking system on economic activity. Yet, there has not been any work which focuses on the level of...

Does a rise in income inequality induce people to work harder to stay in the rat race ("keep up with the Joneses") or to simply drop out? We investigate this issue in a simple new framework in which heterogeneous ability agents get extra utility if their consumption keeps up with the economy's...

Many countries around the world have large public pension programs. Traditionally, these programs have been used to induce retirement by the elderly in order to free up jobs for the young and to redistribute income across generations. This paper provides an efficiency rationale for the...

This paper develops a monetary growth model in which inflation affects credit market efficiency, and via this link, capital accumulation, and the incomes of agents. Some fraction of the population is capitalists, who have access to a risky but high return capital production technology. Capital...