heterogeneity to quantify their effects on wealth inequality. The results show that with the available estimates of the risk … aversion distribution from PSID data the model can match the observed degree of wealth inequality in the U.S., accounting for …

wealth inequality. Using estimates of the earnings processes for each group to calibrate the model, we find wealth inequality … within and between the groups that is consistent with the data. Moreover, the predictions for overall wealth inequality are … heterogeneity generates a between-group pecuniary externality which in turn leads to the predicted differences in wealth inequality …