Related papers: When a `rat race' implies an intergenerational wea…
We present a stylized model with feedback loops for the evolution of a population's wealth over generations. Individuals have both talent and wealth: talent is a random variable distributed identically for everyone, but wealth is a random…
We characterize the outcomes of a canonical deterministic model for the intergenerational transmission of capital that features differential fertility. A fertility function determines the relationship between parental capital and the number…
We consider a simple theoretical model to investigate the impact of inheritances on the wealth distribution. Wealth is described as a finite resource, which remains constant over different generations and is divided equally among offspring.…
Reproductive success and survival are influenced by wealth in human populations. Wealth is transmitted to offsprings and strategies of transmission vary over time and among populations, the main variation being how equally wealth is…
Opportunities such as higher education can promote intergenerational mobility, leading individuals to achieve levels of socioeconomic status above that of their parents. We develop a dynamic model for allocating such opportunities in a…
We introduce a toy model of the "rat race" in which individuals try to better themselves relative to the rest of the population. An individual is characterized by a real-valued fitness and each advances at a constant rate by an amount that…
A growing literature provides evidence on multigenerational inequality -- the extent to which socio-economic advantages persist across three or more generations. This chapter reviews its main findings and implications. Most studies find…
We analyze the household savings problem in a general setting where returns on assets, non-financial income and impatience are all state dependent and fluctuate over time. All three processes can be serially correlated and mutually…
We present a model in which we investigate the structure and evolution of a random network that connects agents capable of exchanging wealth. Economic interactions between neighbors can occur only if the difference between their wealth is…
Opportunities, such as access to education or family background, shape income inequality by influencing the chances of economic success. Unequal opportunities create uncertainty about whether success is merit- or luck-based. We examine how…
Simple agent based exchange models are a commonplace in the study of wealth distribution of artificial societies. Generally, each agent is characterized by its wealth and by a risk-aversion factor, and random exchanges between agents allow…
This paper studies the income fluctuation problem with capital income risk (i.e., dispersion in the rate of return to wealth). Wealth returns and labor earnings are allowed to be serially correlated and mutually dependent. Rewards can be…
We investigate the effects of wariness (defined as individuals' concern for their minimum utility over time) on poverty traps and equilibrium multiplicity in an overlapping generations (OLG) model. We explore conditions under which (i)…
When group members claim a portion of limited resources, it is tempting to invest more effort to get a larger share. However, if everyone acts similarly, they all get the same piece they would obtain without extra effort. This is the…
Biological competition is widely believed to result in the evolution of selfish preferences. The related concept of the `homo economicus' is at the core of mainstream economics. However, there is also experimental and empirical evidence for…
We study intergenerational transfers of income. In our stylized model, each generation in an infinite (but countable) stream is endowed with some income. An allocation rule associates with each infinite stream another stream, thus involving…
Decision-making individuals often imitate their highest-earning fellows rather than optimize their own utilities, due to bounded rationality and incomplete information. Perpetual fluctuations between decisions have been reported as the…
This paper proposes a new way to model behavioral agents in dynamic macro-financial environments. Agents are described as neural networks and learn policies from idiosyncratic past experiences. I investigate the feedback between…
We propose a set of conservative models in which agents exchange wealth with a preference in the choice of interacting agents in different ways. The common feature in all the models is that the temporary values of financial status of agents…
A model based on first-degree family relations network is used to describe the wealth distribution in societies. The network structure is not a-priori introduced in the model, it is generated in parallel with the wealth values through…