This paper focuses on the transitory relationship between output level and Income inequality. As a result of either permanent or transitory sectoral technological shocks the economy will adjust to a new steady state equilibrium, but during the transition the dynamics of wages and workers will generate departures from the steady state level of income inequality.
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Paper provided by University of Virginia, Department of Economics in its series Virginia Economics Online Papers with number
373.
Find related papers by JEL classification: E2 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
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