ESSAYS ON INCOME AND WEALTH INEQUALITY

Abstract

In the first chapter, I study the consequences of redistribution on economic inequality in the presence of human capital risk using an overlapping generations model. I find redistributions financed by taxation could be inequality enhancing if we consider lag effect and general equilibrium effect of taxes.

In the second chapter, I examine the earnings, income, and wealth distributions in China using the 2011 China Household Finance Survey. I find high inequalities of all three variables among Chinese households. Top households tend to be young and with their income largely generated from business.

In the third chapter, I set up a parsimonious asset-pricing island model with rational bubbles, and the model simultaneously matches four trends, the rising mean and the slowly increasing dispersion of housing rents, and the rising mean and the steeply increasing dispersion of housing prices, in the United States during 1975-2007.