Exploring the income distribution business cycle dynamics

Business Cycle Dynamics

This paper attempts to simulate endogenous cyclical behaviour through variations on the standard real business models. This paper relaxes the perfect foresight assumption implied by the rational agent hypothesis. It is replaced by imperfect adaptive expectations. The model is extended with a delay between investment and capital accumulation. This paper also simulates a non-equilibrium timediffe...

Exploring the Dynamics of Top Income Inequality

Top income inequality has risen sharply in the United States over the last 30 years but remained low and stable in economies like France and Japan. Why? This paper explores three theoretical mechanisms that endogenize the amount of top income inequality. The first model suggests that the rate of growth of top incomes is a key determinant. A rise in the returns to experience or an increase in ef...

Business Cycle Features In The Iranian Economy

Consumption and Income Poverty over the Business Cycle

We examine the relationship between the business cycle and poverty for the period from 1960 to 2008 using income data from the Current Population Survey and consumption data from the Consumer Expenditure Survey. This new evidence on the relationship between macroeconomic conditions and poverty is of particular interest given recent changes in anti-poverty policies that have placed greater empha...

Business Cycle Dynamics under Rational Inattention∗

This paper studies a dynamic stochastic general equilibrium model with rational inattention. Decisionmakers have limited attention and choose the optimal allocation of their attention. We study the implications of rational inattention for business cycle dynamics. For example, we study how rational inattention affects impulse responses of prices and quantities to monetary policy shocks, aggregat...