The wealth distribution in Bewley economies with capital income risk

Jess Benhabib, Alberto Bisin, Shenghao Zhu

    Research output: Contribution to journalArticlepeer-review

    Abstract

    We study the wealth distribution in Bewley economies with idiosyncratic capital income risk. We show analytically that under rather general conditions on the stochastic structure of the economy, a unique ergodic distribution of wealth displays a fat tail.

    Original languageEnglish (US)
    Pages (from-to)489-515
    Number of pages27
    JournalJournal of Economic Theory
    Volume159
    DOIs
    StatePublished - 2015

    Keywords

    • Bewley economies
    • Capital income risk
    • Fat tails
    • Pareto distribution
    • Wealth distribution

    ASJC Scopus subject areas

    • Economics and Econometrics

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