Wealth Inequality in a Low Rate Environment

Contra Piketty: We study the effect of interest rates on wealth inequality. While lower rates decrease the growth rate of rentiers, they also increase the growth rate of entrepreneurs by making it cheaper to raise capital. To understand which effect dominates, we derive a sufficient statistic for the effect of interest rates on the Pareto […] The post Wealth Inequality in a Low Rate Environment appeared first on Marginal REVOLUTION.