transition following the optimal reform in the capital-skill complementarity model, implying substantial indirect redistribution …This paper shows that capital-skill complementarity provides a quantitatively significant rationale to tax capital for … redistributive governments. The optimal capital income tax rate is 60%, which is significantly higher than the optimal rate of 48% in …

transfers over this period is taken into account. We show that the increase in capital's share of total income and the presence … of capital-entrepreneurial skill complementarity are two key features that help support the wages of ordinary workers as … the new technology diffuses. -- income inequality ; skill-biased technological change ; capital-skill complementarity …

transfers over this period is taken into account. We show that the increase in capital's share of total income and the presence … of capital-entrepreneurial skill complementarity are two key features that help support the wages of ordinary workers as …

We introduce permanently-shifting income shares into a growth model with workers and capital owners. The model exactly … replicates the U.S. time paths of the top quintile income share, capital's share of income, and key macroeconomic variables from … partially offset by longer-term gains from higher transfers and more capital per worker. The baseline simulation delivers large …