Partial Insurance and Consumption inequality

Abstract

• Inequality has many linked dimensions: wages, incomes and consumption • The literature on the first two types is huge • The literature on consumption inequality is less developed, but growing. • The link between the various types of inequality is mediated by multiple insurance mechanisms • The amount of insurance available to consumers depends on the durability of income shocks • The more persistent are income shocks, the lower is the amount of insuranceThis paper • Uses the evolution of income and consumption inequality in the US to identify – Income inequality due to permanent and transitory component

Download PDF:
_{Sorry, we are unable to provide the full text but you may find it at the following location(s):}

http://citeseerx.ist.psu.edu/v... (external link)

http://www.aeaweb.org/annual_m... (external link)