A. ON MACROECONOMICS AND INEQUALITY
“Top Income Shares, Inequality, and Business Cycles: United States, 1957-2016”, European Economic Review, vol. 150, 2022. [Publication]
To study the causes and consequences of cyclical fluctuations in labor and capital income inequality through structural lenses, I develop and estimate a TANK model featuring business and inequality cycles. Matching the top 10% compensation and capital income shares disciplines distributional implications of the model, and reveals aggregate implications of heterogeneity. In a setup with aggregate and agent-type spe- cific forces, cycles in income inequality and top income shares are to a large extent the outcome of aggregate forces, operating via heterogeneity in skills, labor market institutions, and investment opportunities. Inequality influences the relative impor- tance of aggregate forces in output cycles, links investment to labor market conditions, disaggregates labor market cycles, and amplifies the effect of shocks causing counter- cyclical inequality.
“The National Wealth-Income Ratio in Greece, 1974-2013”, Review of Income and Wealth, 64 (1), 2018. [Publication], [WP]
This paper estimates the evolution of the national wealth–income ratio in Greece. Similarly to the European evidence, the ratio rises from about 280% in the 1970s to about 500% on the eve of the current financial crisis. During 1997–2007, the saving-induced wealth growth vanishes and prolonged capital gains result in a rising wealth–income ratio.
* Coverage of the paper’s estimates in World Inequality Database, [Link]
B. ON THE LABOR MARKET
“Automation in a Business Cycle Model: Insights from RANK”, Working Paper, 2023. [Link]
This paper incorporates labor-saving technology, via which capital replaces workers in production, in a business cycle model with several market imperfections. It shows that nominal rigidities and frictions alter considerably the transmission of automation over the business cycle, by amplifying the displacement of labor and thus the employment fall, and by attenuating the productivity gains.
“On Unemployment Cycles in the Euro Area, 1999-2018”, European Economic Review, vol. 121, 2020. [Publication] , [WP]
This paper studies the recurrent sources of unit-root unemployment fluctuations in Greece, Italy, Portugal, Spain, and the Euro Area by modelling wage markup and labor disutility shocks that exhibit permanent euro-area-wide shifts, country-specific trend developments, and stationary changes. It reveals the importance of demand-driven fluctuations.
“The U.S. Labor Income Share and Automation Shocks”, Economic Inquiry, 58 (1), 2020. [Publication] , [WP]
The causes and consequences of the 1964–2016 swings in the U.S. labor income share (LS) are parsed through the lens of a structural model. Where conventional models fall short, the present model yields a counter-cyclical LS in response to demand shocks. Automation shocks account for about half of LS fluctuations and generate a counter-cyclical labor response.
“Wages During Recoveries in the Euro-Area Economies. A Structural View.”, Working Paper. [WP]
This paper documents the heterogeneity in wage growth and examines its drivers during economic recoveries since the 1990s in the big four European economies.
C. ON THE PANDEMIC
“The COVID-19 Pandemic and the Consumption of Nondurables and Services”, with Justine Guillochon, Applied Economics Letters, vol. 29 (12), 1084-1095, 2022. [Publication]
Contrary to the Great and other past US Recessions, the reduction in services consumption exceeds the decline in nondurables consumption during the COVID-19 pandemic. We study the drivers of this unprecedented phenomenon through the lens of a model that distinguishes between nondurables and services sectors.
D. ON EXPECTATIONS
“Evolving Beliefs and Animal Spirits in the Euro Area”, Working Paper, with Fabio Milani
Nikolaos Charalampidis 