We propose a theory of indebted demand, capturing the idea that large debt burdens by households and governments lower … aggregate demand, and thus natural interest rates. At the core of the theory is the simple yet under-appreciated observation … that borrowers and savers differ in their marginal propensities to save out of permanent income. Embedding this insight in …

Using new long-run microdata, this paper studies wealth and income trends of college and non-college households in the … United States since 1956. We document the emergence of a substantial college wealth premium since the 1980s, which is … considerably larger than the college income premium. Over the past four decades, the wealth of American households with a college …

-run wealth distribution, high interest rates imply exploding wealth dynamics. When matching the NLSY 79 evolution of the wealth … distribution from 1986 to 2008, we obtain a fit of 96:1%: With a more flexible interest rate distribution, employing "superstar … states", the fit can increase to 96:7%. For the fit of 96:1%, the standard deviation of model returns is much lower than the …

-to-face survey experiment on a representative sample of Germans. We measure how individuals form perceptions of their ranks in the …

insights into the role of country-specific shocks in shaping long-run wealth dynamics. This paper presents the first … comprehensive study of wealth and its distribution in Germany since the 19th century. We combine tax and archival data, household … surveys, historical national accounts, and rich lists to analyze the evolution of the German wealth distribution over the long …

In this paper we study the contribution of migrants to the rise in UK top incomes. Using administrative data on the … universe of UK taxpayers we show migrants are over-represented at the top of the income distribution, with migrants twice as …, and migrants are concentrated in only a handful of industries, predominantly finance. Almost all (85%) of the growth in …

We provide the first estimates of intergenerational income mobility for a developing country, namely Brazil. We measure … informal income. The data reveal a much higher degree of persistence than previous estimates available for developed economies … persistence is even higher in the top 5%. Children born to parents in the first income quintile face a 46% chance of remaining at …

This paper combines the standard incomplete markets model of uninsurable idiosyncratic risks and borrowing constraints … with the Arrow/Romer approach to endogenous growth to analyze the interaction of risk, growth, and inequality, the latter … also endogenously determined in equilibrium. We derive conditions on existence and nonexistence of balanced growth paths …

We show how normative standpoints determine optimal taxation of wealth. Since wealth is not equal to capital, we find … very different welfare implications of land rent-, bequest- and capital taxation. It is mainly land rents that should be … disapproves of bequeathing, bequest taxation becomes slightly more desirable …

We study how attitudes to inheritance taxation are influenced by information about the role of inherited wealth in … aggregate importance of inherited wealth and its link to inequality of opportunity significantly increases the support for … inheritance taxation. The effect is almost uniform across socio-economic groups and survives a battery of robustness tests …