Skewed wealth distributions: Theory and empirics

Jess Benhabib, Alberto Bisin

    Research output: Contribution to journalArticle

    Abstract

    Invariably, across a cross-section of countries and time periods, wealth distributions are skewed to the right displaying thick upper tails, that is, large and slowly declining top wealth shares. In this survey, we categorize the theoretical studies on the distribution of wealth in terms of the underlying economic mechanisms generating skewness and thick tails. Further, we show how these mechanisms can be micro-founded by the consumption-savings decisions of rational agents in specific economic and demographic environments. Finally we map the large empirical work on the wealth distribution to its theoretical underpinnings.

    Original languageEnglish (US)
    Pages (from-to)1261-1291
    Number of pages31
    JournalJournal of Economic Literature
    Volume56
    DOIs
    StatePublished - Dec 2018

    ASJC Scopus subject areas

    • Economics and Econometrics

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