Full Citation
Title: Essays on Economic Inequality
Citation Type: Dissertation/Thesis
Publication Year: 2014
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Abstract: This dissertation consists of three chapters on di fferent aspects of economic inequality. In the fi rst chapter, I study the aggregate implications of health risk and access to health care. At the individual level, health influences earnings potential, while income aff ects access to medical care. I investigate how this interaction shapes the joint dynamics of inequality in health and earnings over the life cycle, and I measure the redistributive impact of policies that improve access to health care. For that, I introduce health shocks and health care spending in an incomplete markets model with heterogeneous agents. Earnings risk is partially determined within the model due to the health-income feedback, and negative shocks may drive agents into a low income-low health trap, thus magnifying inequality along the life cycle. I estimate the process for health shocks and I calibrate the key parameters of the model using survey data. The calibrated model successfully reproduces the joint dynamics in health and earnings inequality in the life cycle. Like in the data, it predicts that life cycle inequality in health is driven by a sharp decline in health status for the lowest percentiles of the health distribution. I nd that the health-income feedback accounts for 9 percent of total earnings inequality at retirement age as measured by the coefficient of variation of earnings, and that it increases by almost seven times the persistence of shocks to productivity. I also find that health care policies that facilitate access to health care have redistributive e ffects, mostly through earnings improvements for those at the bottom of the earnings distribution.
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Authors: Jose Prados, Maria
Institution: Columbia University
Department: Arts and Sciences
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Degree: Doctor of Philosophy
Publisher Location: New York, NY
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Data Collections: IPUMS CPS
Topics: Family and Marriage, Gender, Health, Labor Force and Occupational Structure
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