This paper explores the extent to which the presence of ex-ante transaction costs may lead to failures of the Coase Theorem. In particular we identify and investigate the basic 'hold-up problem' which arises whenever the parties to a Coasian negotiation have to pay some ex-ante costs for the...

This paper proposes a method to decompose earnings inequality into a component due to unequal opportunities and a residual term. Drawing on the distinction between 'circumstance' and 'effort' variables in John Roemer's work on equality of opportunity, we associate inequality of opportunities...

This paper investigates possible explanations for the increases in inequality observed in Brazil during the 1980s. While the static decompositions of inequality by household characteristics reveal that education and race of the household head, as well as geographic location, can account for a...

Using a newly available comprehensive micro-data set we examine changes in the shape of the Brazilian income distribution during the quot;lost decadequot; of the 1980s. We adopt alternative parametric and non-parametric approaches to modelling the distribution. We show that inequality changed...

This paper proposes a model of wealth distribution dynamics with a capital market imperfection and a production function where public capital is complementary to private capital. A unique invariant steady-state distribution is derived, with three social classes: subsistence workers, 'government...

Using nationally representative, economywide data, this paper investigates the relative importance of trade-mandated effects on industry wage premia; industry and economywide skill premia; and employment flows in accounting for changes in the wage distribution in Brazil during the 1988-95 trade...

Just as equality of opportunity becomes an increasingly prominent concept in normative economics, the authors argue that it is also a relevant concept for positive models of the links between distribution and aggregate efficiency. Persuasive microeconomic evidence suggests that inequalities in...

Measured by the Gini coefficient, income inequality in Brazil rose from 0.57 in 1981 to 0.63 in 1989, before falling back to 0.56 in 2004. This latest figure would lower Brazil's world inequality rank from 2nd (in 1989) to 10th (in 2004). Poverty incidence also followed an inverted U-curve over...