This paper quantifies the impact of borrowing constraints on consumption and earnings inequality in a life-cycle model with labor market search and endogenous human capital accumulation. I first show that following an unemployment spell, likely-constrained workers in the Survey of Income and...

U.S. consumption has gone through steep ups and downs since 2000. We quantify the statistical impact of income, unemployment, house prices, credit scores, debt, financial assets, expectations, foreclosures, and inequality on county-level consumption growth for four subperiods: the "dot-com...

The recent literature has shown that income inequality is one of the main causes of borrowing and debt accumulation by working households. This paper explores the possibility that household indebtedness is an important cause of rising income inequality. If workers experience rising debt burdens,...

To many economists the public's support for the minimum wage (MW) institution is puzzling, since the MW is considered a “blunt instrument” for redistribution. To delve deeper in this issue we build models in which workers are heterogeneous in ability. In the first model, the government does...

In the present paper through an empirical analysis it will be pointed out that e-shopping improves income distribution, while economic and financial crisis worsen it. Data are taken from Eurostat. The elaboration of these panel data is made feasible by means of the Eviews software package

87 percent of Canadians who in 1990 had incomes in the lowest quintile, in 2009 had incomes that placed them in higher quintiles. Of those in the highest quintile, 36 percent had moved to lower ones. All Canadians have been getting richer, the poor more than the rich; the middle class has not...

I show how the mechanisms of debt relief, redistribution and the uncertainty related to them could boil down to a discount rate shock for an aggregate representative agent. The mechanism hails from Ramsey's conjecture and the relationship between debt relief and the probability of repayment. To...

What is the macroeconomic implications of inequality caused by technological progress? Using a standard over-lapping-generations model with skill heterogeneity and the Roy-type occupational choice, this paper examines how routine-biased technological change impacts income distribution and...

Intergenerational inequality and old-age poverty are salient issues in contemporary China. China's aging population threatens the fiscal sustainability of its pension system, a key vehicle for intergenerational redistribution. We analyze the positive and normative effects of alternative pension...

Using an intertemporal model of saving and capital accumulation we demonstrate that it is impossible for any binding minimum wage to increase the after-tax incomes of workers if the production function is Cobb-Douglas with constant returns to scale, or if there are no differences in ability...