Large Devaluation and Inequality: The Case of Lebanon (Note)
Relevance:This article seeks to structure the necessary public debate on the effects of a possible (and increasingly inevitable) official devaluation of the Lebanese Lira. On the one hand, the peg is unsustainable. On the other hand, the peg is necessary to maintain inflation and the purchasing power of poorer households. A devalued exchange rate will […]
The distributional effects of the 2007-2008 crisis and aftermath government policies in Portugal (Etude)
This article provides detailed insights into the distributional effects of the 2007-2008 crisis and aftermath government policies, in Portugal. It sheds new light on the distributional consequences of aggregate crises and crisis-coping policies, providing useful information for improving their design. Summary: The 2007-2008 crisis and aftermath government policies had significant impacts on the Portuguese […]
Rising Income Inequality and Aggregate Activity (Note)
Why rising income inequality may hurt aggregate activity: the role of the marginal propensity to consume Summary: – The marginal propensity to consume is a declining function of income. – An increase in income inequality will therefore divert resources away from agents with a higher marginal propensity to consume towards those with a lower […]