Aggregate Implications of Wealth Redistribution: The Case of Inflation

13 Pages Posted: 26 Jun 2006

See all articles by Matthias Doepke

Matthias Doepke

Northwestern University - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Martin Schneider

Independent

Multiple version iconThere are 2 versions of this paper

Date Written: March 2006

Abstract

This paper shows that a zero-sum redistribution of wealth within a country can have persistent aggregate effects. Motivated by the case of an unanticipated inflation episode, we consider redistribution shocks that shift resources from old to young households. Aggregate effects arise because there are asymmetries in the reaction of winners and losers to changes in wealth. We focus on two sources of asymmetries: differences in the average age of winners and losers, and differences in their labour force status.

Keywords: Aggregate effects, inflation, redistribution

JEL Classification: D31, D58, E31, E50

Suggested Citation

Doepke, Matthias and Schneider, Martin, Aggregate Implications of Wealth Redistribution: The Case of Inflation (March 2006). CEPR Discussion Paper No. 5552. Available at SSRN: https://ssrn.com/abstract=912240

Matthias Doepke (Contact Author)

Northwestern University - Department of Economics ( email )

2003 Sheridan Road
Evanston, IL 60208
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Martin Schneider

Independent ( email )

No Address Available
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
13
Abstract Views
472
PlumX Metrics