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Wealth inequality: data and models
TLDR
In the United States, wealth is highly concentrated and very unequally distributed: the richest 1% hold one third of the total wealth in the economy as mentioned in this paper. But understanding the determinants of wealth inequality is a challenge for many economic models.Abstract:
In the United States wealth is highly concentrated and very unequally distributed: the richest 1% hold one third of the total wealth in the economy. Understanding the determinants of wealth inequality is a challenge for many economic models. We summarize some key facts about the wealth distribution and what economic models have been able to explain so far.read more
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Older Americans 2012: Key Indicators of Well-Being
TL;DR: A report from the Federal Inter-Agency Forum on Aging Related Stats provides the latest data on the 37 key indicators selected by the Forum to portray aspects of the lives of older Americans and their families.
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Inequality: Causes and Consequences
TL;DR: The authors provide an update of research on the patterns and causes of economic inequality in the United States, including inequality of earnings, wealth, and opportunity, and explore the social and political consequences of inequality, particularly in the areas of health, education, crime, social capital and political power.
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Entrepreneurship, Frictions, and Wealth
Marco Cagetti,Marco Cagetti,Mariacristina De Nardi,Mariacristina De Nardi,Mariacristina De Nardi +4 more
TL;DR: In this paper, the authors construct a model that matches wealth inequality very well, for both entrepreneurs and non-entrepreneurs, and find that more restrictive borrowing constraints generate less wealth concentration, but also reduce average firm size, aggregate capital, and the fraction of entrepreneurs.
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Quantitative Macroeconomics with Heterogeneous Households
Jonathan Heathcote,Kjetil Storesletten,Kjetil Storesletten,Giovanni L. Violante,Giovanni L. Violante +4 more
TL;DR: The authors reviewed the quantitative macroeconomic literature that focuses on household heterogeneity, with a special emphasis on the "standard" incomplete markets model, and organized the vast literature according to three themes central to understanding how inequality matters for macroeconomics.
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Wealth and the Inflated Self Class, Entitlement, and Narcissism
TL;DR: These findings offer novel evidence regarding the influence of social class on the self and highlight the importance of social stratification to understanding basic psychological processes.
References
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Income Inequality in the United States, 1913–1998
Thomas Piketty,Emmanuel Saez +1 more
TL;DR: The authors showed that the large shocks that capital owners experienced during the Great Depression and World War II have had a permanent effect on top capital incomes and argued that steep progressive income and estate taxation may have prevented large fortunes from fully recovering from these shocks.
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Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence
TL;DR: The authors formally developed a model of giving in which altruism is not "pure." In particular, people are assumed to get a "warm glow" from giving, and this model generates identifiable comparative statics results that show that crowding out of charity is incomplete and that government debt will have Keynesian effects.
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Occupational Choice and the Process of Development
TL;DR: In this paper, the authors model economic development as a process of institutional transformation by focusing on the interplay between agents' occupational decisions and the distribution of wealth, and demonstrate the robustness of this result by extending the model dynamically and studying examples in which initial wealth distributions have long-run effects.
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Uninsured Idiosyncratic Risk and Aggregate Saving
TL;DR: In this article, the authors present a qualitative and quantitative analysis of the standard growth model modified to include precautionary saving motives and liquidity constraints, and address the impact on the aggregate saving rate, the importance of asset trading to individuals, and the relative inequality of wealth and income distributions.
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Income and Wealth Heterogeneity in the Macroeconomy
Per Krusell,Anthony A. Smith +1 more
TL;DR: In this paper, a calibrated version of the stochastic growth model with partially uninsurable idiosyncratic risk and movements in aggregate productivity is used to analyze how movements in the distribution of income and wealth affect the macroeconomy.