Calendrier du 18 janvier 2022
Applied Economics Lunch Seminar
Du 18/01/2022 de 12:30 à 13:30
Jourdan R1.09
EYQUEM Aurélien (Université Lumière Lyon 2)
Explaining Income and Wealth Inequality over the Long Run: The Case of France
écrit avec Stéphane Auray, Bertrand Garbinti, Jonathan Goupille
We incorporate microeconomic evidence for France using distributional accounts into a general equilibrium model with heterogeneous workers, endogenous labor supply, entrepreneurs, three assets (deposits, housing and capital), heterogeneous discount factors and wealth in the utility. Calibrated using 1984 data, the initial stationary distribution matches the observed levels of income and wealth inequalities up to the top 1%, as well as the aggregate wealth-income ratio. It also fits the observed composition of wealth along the distribution, which makes returns on wealth increase with wealth levels, as in the data. From 1985 to 2018, we feed the model with exogenous changes in taxes and transfers, firms' markups, aggregate productivity, capital depreciation and equity and housing capital gains. The model replicates the observed dynamics of income and wealth inequalities as well as the dynamics of most macroeconomic aggregates. Counterfactual experiments suggest that markups and the tax system are the main interacting drivers of rising income and wealth inequalities over the last 40 years in France.