Golosov, Mikhail; Sargent, Thomas; Bhandari, Anmol; … - National Bureau of Economic Research (NBER) - 2013
A planner sets a lump sum transfer and a linear tax on labor income in an economy with incomplete markets, heterogeneous agents, and aggregate shocks. The planner's concerns about redistribution impart a welfare cost to fluctuating transfers. The distribution of net asset holdings across agents...