Wealth inequality in dynamic stochastic general equilibrium models
| Autor: | Mgr. Tomáš Troch |
|---|---|
| Rok: | 2014 - letní |
| Vedoucí: | PhDr. RNDr. Josef Stráský Ph.D. |
| Konzultant: | |
| Typ práce: | Diplomová Ekonomická teorie |
| Jazyk: | Anglicky |
| Stránky: | 88 |
| Ocenění: | Pochvala děkana Fakulty sociálních věd za vynikající výkon u státních zkoušek a za vynikající diplomovou práci. |
| Odkaz: | https://is.cuni.cz/webapps/zzp/detail/138285/ |
| Abstrakt: | In my diploma thesis I propose a dynamic stochastic general equilibrium model to describe economic inequality. The model combines two approach es that were traditionally used to model inequality - first, it features two classes of agents that differ in their ownership of capital and second, each class consists of heterogeneous agents who are subject to uninsurable idiosyncratic shocks. This combin ation allows the two classes to behave in a fundamentally different way while maintaining the individual character of agents in the economy - a feature that has not been modeled before but which adequately describes the empirical reality. I show that the model with classical RBC structure and a single wage underestimates the observed inequality. When the wage differential is introduced through different taxation of the two classes, the model matches empirical inequality much better. Further I argue that th e government can significantly reduce inequality at a relatively small cost in terms of output lost. Finally using Theil coefficient decomposition, I show how much of the total inequality is attributable to between - class and within - class inequalities |
