The cumulative growth rate of the German economy since reunification would have been around two percentage points higher if income inequality had remained constant. This is whatsimulations using the DIW Macroeconomic Model have shown. They were made under the assumption that the income...

We estimate growth rates of real incomes in the U.S. by quintiles using the Congressional Budget Office’s (CBO) post-tax, post-transfer data as basis for the period 1979-2011. We improve upon them by including only the present value of earnings that will accrue in retirement and excluding...

This study explores the relationship between inequality and structural transformation by constructing a theoretical model, developing analytical frameworks, and implementing a case study. The general equilibrium model we develop demonstrates that inequality exhibits an inverted U shape as...

We investigate how income inequality affects social welfare in a model of voluntary contributions to multiple pure public goods. Itaya, de Meza, and Myles (1997) show that the maximization of social welfare precludes income equality in a single pure public good model. In contrast, we show that...

We study how the distribution of income among members of society, and income inequality in particular, affects social willingness to pay (WTP) for environmental public goods. We find that social WTP for environmental goods increases with mean income, and decreases (increases) with income...

This paper is meant to analyse the effects of labour market structural reforms by means of an agent-based model. Building on Dosi et al., (2016b) we introduce a policy regime change characterized by a set of structural reforms on the labour market, keeping constant the structure of the capital-...

This paper calculates the CO2e (CO2 equivalents) footprint of private consumption in the EU27 by five groups of household income, using a fully fledged macroeconomic input-output model covering 59 industries and five groups of household income for the EU27. Due to macroeconomic feedback...

The gender wage gap is a persistent labor market phenomenon. Most research focuses on the determinants of these wage differences. We contribute to this literature by exploring a different research question: if wages of women are systematically lower than male wages, what are the distributional...

The gender wage gap is a persistent labor market phenomenon. Most research focuses on the determinants of these wage differences. We contribute to this literature by exploring a different research question: if wages of women are systematically lower than male wages, what are the distributional...

Labour market performance as measured by employment rates conceals significant differences among EU countries. In 2014 the variation was between 48.8% in Greece and 74.4% in Sweden. Average employment rate for the EU28 was at 64.8% in 2014, perceptibly below the Lisbon goal of 70 percent....

Since Aristotle, a vast literature has suggested that economic inequality has important political consequences. Higher inequality is thought to increase demand for government income redistribution in democracies and to discourage democratization and promote class conflict and revolution in...

This paper provides a comprehensive overview of the development in income distribution and outlines its major long-term trends of 23 countries worldwide. These countries are clustered in four groups covering the core advanced, the Nordic, the emerging, and the least developed economies of the...

India witnessed high levels of growth in the last decade but national levels of poverty and inequality remain high. Infrastructure provision is seen as a particularly important instrument for helping in regional development where government can play a significant role due to the public goods...

Policy analysis frequently requires estimates of aggregate (or mean) consumer elasticities. However, estimates are often made incorrectly, based on elasticity calculations at mean income. We provide in this paper an overall integrated analytical framework that encompasses these biases and...

This paper analyses major pension system regulation in four European countries: Denmark, Germany, Sweden, and the United Kingdom. It is focused on the government's and social partner's efforts to provide old-age security benefits, and how these regulatory approaches have shaped the current...

We develop a micro-founded general equilibrium model with heterogeneous agents to identify pertinent constraints to financial inclusion. We evaluate quantitatively the policy impacts of relaxing each of these constraints separately, and in combination, on GDP and inequality. We focus on three...

This paper investigates the dynamics of income distribution, private debt, and aggregate demand in the United States in the era before the Great Depression. Based on a post-Keynesian model, I estimate the effects of the wage share and private debt on aggregate demand for private domestic output....

Seit Beginn der 2000er Jahre wurden die traditionellen Studienabschlüsse Diplom und Magister durch die gestuften Studienabschlüsse Bachelor und Master abgelöst. Mittlerweile ist die Umstellung weitestgehend abgeschlossen. Um die längerfristige Positionierung von Bachelorabsolventen am...

Owner-occupied housing and public infrastructure services are a relevant part of the income distribution whose impacts have not yet been adequately studied, at least not from the distributive point of view. This paper suggests a way to find the market value for these services using hedonic...

Non-communicable diseases represent one of the greatest challenges for health policymakers. The main objective of this study is to analyse the development of standardised mortality rates for cerebrovascular disease, which is one of the most common causes of deaths, in relation to income...

Should public investment be targeted to big cities or to small towns, if the objective is to minimize national poverty? To answer this policy question we extend the basic Todaro-type model of rural-urban migration to the case of migration from rural areas to two potential destinations, secondary...

Das Wachstum der deutschen Wirtschaft wäre seit der Wiedervereinigung kumuliert um rund zwei Prozentpunkte höher gewesen, wenn die Einkommensungleichheit konstant geblieben wäre. Darauf weisen Simulationsrechnungen mit dem DIW Makromodell hin, die unter der Annahme durchgeführt wurden, dass...

Using a large, register-based panel data set we study gender differences in top incomes in Sweden over the period 1974–2013. We find that, while women are still a minority of the top decile group, and make up a smaller share the higher up in the distribution we move, their presence has...

This paper provides a novel analysis of the trend in income inequality in the United States between 1979-2013. There are two ways in which this paper contributes to the literature. First, I analyze how much of the existing inequality in the U.S. is due to the demographic changes that happened...

A key aspect defining the contemporary income distribution is the (increasing) share the top holds compared to the rest. This paper shows that income concentration increases towards the very top of the distribution, while the shares the middle- and upper-middle-income groups hold remain stable...

Using a case study about rural Tianjin and Shandong provinces, we try to explain what mechanism affects income inequality in rural areas, especially how rural dual structural transformation leads to the income inequality "inverted-U" Curve in some developed areas in the People's Republic of...

Evidence regarding the relationship between distribution, demand, and growth in the short run has been mixed. Open economy models that create the possibility of "beggar-thy-neighbor" growth offer one theoretical explanation for why this may be expected. Several authors have argued recently,...

When state and local governments engage in balanced budget changes in taxes and spending, what fiscal multiplier effects do such policies have on creating local jobs? Traditionally, the view has been that possible job-creation effects of such state and local "demand-side" policies are smaller,...

This paper uses national accounts data to adjust market and disposable Top 10% and Top 1% household survey income shares for 39 developed and developing countries that are part of the Luxembourg Income Study (LIS). An additional novelty of this study is the distinction between labor and capital...

The earliest age at which women can receive a state pension in the UK (the "state pension age") has been increasing since 2010. We use a difference-in-differences methodology, exploiting the gradual increase from age 60 in 2010 to age 63 in 2016, to estimate the impact of the reform on women's...

Survey under-coverage of top incomes leads to bias in survey-based estimates of overall income inequality. Using income tax record data in combination with survey data is a potential approach to address the problem; we consider here the UK's pioneering 'SPI adjustment' method that implements...

This paper investigates how income inequality affects the quality of imported products. In a heterogeneous-firms trade model, I show that higher inequality increases total expenditure leading to a reduction in unit value and quality of imported goods. To test this prediction, I employ detailed...

This book is open access under a CC BY 4.0 license. This book brings together a range of ideas and theories to arrive at a deeper understanding of inequality in Latin America and its complex realities. To so, it addresses questions such as: What are the origins of inequality in Latin America?...