Within the context of the neoclassical growth model I investigate the implications of (initial) endowment inequality when the rich have a higher marginal savings rate than the poor. More unequal societies grow faster in the transition process, and therefore exhibit a higher speed of convergence....

We construct a neoclassical growth model with heterogeneous households that accounts for the Pareto distributions of income and wealth in the upper tail. In an otherwise standard Bewley model, we feature households' business productivity risks and borrowing constraints, which we find generate...

The publication of the book Capital in the Twenty-First Century by Piketty helped to increase the debate about the prospects of the evolution of income and wealth inequality in this century. One of the main controversies is about the effects to the income and wealth inequalities of a decrease in...

In this article, the author uses a version of the neoclassical growth model with overlapping generations of individuals to investigate the effect of aging on wealth inequality. When an economy’s population becomes older—that is, when the proportion of individuals 65 years of age...