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Income and Wealth Heterogeneity in the Macroeconomy

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  • Per Krusell
  • Anthony A. Smith
  • Jr.

Abstract

How do movements in the distribution of income and wealth affect the macroeconomy? We analyze this question theoretically, using numerical methods, in the context of a calibrated version of the stochastic growth model with partially uninsurable idiosyncratic risk and movements in aggregate productivity.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Per Krusell & Anthony A. Smith & Jr., 1998. "Income and Wealth Heterogeneity in the Macroeconomy," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 867-896, October.
  • Handle: RePEc:ucp:jpolec:v:106:y:1998:i:5:p:867-896
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    References listed on IDEAS

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    1. Lucas, Deborah J., 1994. "Asset pricing with undiversifiable income risk and short sales constraints: Deepening the equity premium puzzle," Journal of Monetary Economics, Elsevier, vol. 34(3), pages 325-341, December.
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    3. Aiyagari, S. Rao & Gertler, Mark, 1991. "Asset returns with transactions costs and uninsured individual risk," Journal of Monetary Economics, Elsevier, vol. 27(3), pages 311-331, June.
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    7. Sharon A. Johnson & Jery R. Stedinger & Christine A. Shoemaker & Ying Li & José Alberto Tejada-Guibert, 1993. "Numerical Solution of Continuous-State Dynamic Programs Using Linear and Spline Interpolation," Operations Research, INFORMS, vol. 41(3), pages 484-500, June.
    8. Cochrane, John H, 1989. "The Sensitivity of Tests of the Intertemporal Allocation of Consumption to Near-Rational Alternatives," American Economic Review, American Economic Association, vol. 79(3), pages 319-337, June.
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    11. Chatterjee, Satyajit, 1994. "Transitional dynamics and the distribution of wealth in a neoclassical growth model," Journal of Public Economics, Elsevier, vol. 54(1), pages 97-119, May.
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    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy

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    1. Recursive Macroeconomic Theory

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