Related papers: How Much Income Inequality Is Too Much?
Heterogeneous treatment effects are of major interest in economics. For example, a poverty reduction measure would be best evaluated by its effects on those who would be poor in the absence of the treatment, or by the share among the poor…
In the so-called ``fair'' models of peer-to-peer wealth exchanges, economic inequality tends to reach its maximum value asymptotically. This global trend is evident as the richest continuously accumulate a larger share of wealth at the…
We consider concepts and models for measuring inequality in the distribution of resources with a focus on how inequality varies as a function of covariates. Lorenz introduced a device for measuring inequality in the distribution of income…
We study the distributional implications of uncertainty shocks by developing a model that links macroeconomic aggregates to the US distribution of earnings and consumption. We find that: initially, the fraction of low-earning workers…
There is growing interest in designing recommender systems that aim at being fair towards item producers or their least satisfied users. Inspired by the domain of inequality measurement in economics, this paper explores the use of…
Social inequality is a topic of interest since ages, and has attracted researchers across disciplines to ponder over it origin, manifestation, characteristics, consequences, and finally, the question of how to cope with it. It is manifested…
This paper provides a new theory of the observed co-movement between overall wage inequality and its between-firm component. We develop and solve analytically a frictionless sorting model with two-sided heterogeneity, in which firms consist…
Standard macroeconomic models assume that households are rational in the sense that they are perfect utility maximizers, and explain economic dynamics in terms of shocks that drive the economy away from the stead-state. Here we build on a…
In the recent times of global Covid pandemic, the Federal Reserve has raised the concerns of upsurges in prices. Given the complexity of interaction between inflation and inequality, we examine whether the impact of inflation on inequality…
In this paper we explore the dynamic relationship between income inequality and economic mobility through a pairing of a population-scale partial differential equation (PDE) model and an associated individual-based stochastic differential…
I discuss economic and social sources of inequality and elaborate on the role of social networks in inequality, economic immobility, and economic inefficiencies. The lens of social networks clarifies how the entanglement of people's…
An increasingly large number of experiments study the labor productivity effects of automation technologies such as generative algorithms. A popular question in these experiments relates to inequality: does the technology increase output…
It is widely assumed that increases in economic productivity necessarily lead to economic growth. In this paper, it is shown that this is not always the case. An idealized model of an economy is presented in which a new technology allows…
"The rich are getting richer" implies that the population income distributions are getting more right skewed and heavily tailed. For such distributions, the mean is not the best measure of the center, but the classical indices of income…
This paper analyzes whether a minimum wage should be used for redistribution on top of taxes and transfers. I characterize optimal redistribution for a government with three policy instruments -- labor income taxes and transfers, corporate…
The Gini index is a function that attempts to measure the amount of inequality in the distribution of a finite resource throughout a population. It is commonly used in economics as a measure of inequality of income or wealth. We define a…
We investigate the dynamics of wealth inequality in an economy where households have positional preferences, with the strength of the positional concern determined endogenously by inequality of wealth distribution in the society. We…
The article examines how institutions, automation, unemployment and income distribution interact in the context of a neoclassical growth model where profits are interpreted as a surplus over costs of production. Adjusting the model to the…
Economic competition between humans leads to income inequality, but, so far, there has been little understanding of underlying quantitative mechanisms governing such a collective behavior. We analyze datasets of household income from 67…
Economic inequality emerges from the interplay between regional growth-rate differences and the interaction network that couples regions. We propose a minimal income-dynamics model, where heterogeneity is governed by growth-rate…