ENTREPRENEURSHIP AND INCOME DISTRIBUTION DYNAMICS: WHY IS THE INCOME SHARE OF TOP INCOME EARNERS ACYCLICAL OVER THE BUSINESS CYCLE?

• 成果类型: Article
• 署名作者: Kwark, Noh-Sun; Ma, Eunseong
• 署名单位: Sogang University; Louisiana State University System; Louisiana State University
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12489
• 发表日期: 2021
• 页码: 321-356
• 关键词: Idiosyncratic risk; Heterogeneity; MODEL; PRODUCTIVITY; aggregation; frictions; finance; WEALTH; wages; time

摘要

In the United States, the income share of the top 5% income group is acyclical over the business cycle. This study attempts to explain the cyclical behavior of the income distribution over the business cycle, particularly focusing on the top 5% income earners' share, using a heterogeneous agent model featuring a choice to become an entrepreneur. The model economy successfully reproduces the acyclical behavior of the income share of the top 5%. During expansions, relatively more people become entrepreneurs at the top, which offsets the decline in the income share of the high-income earners from workers' side.