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Is Inequality Increasing in r-g? The Dynamics of Capital’s Income Share in the UK, 1210-2013

Jakob Madsen ()

No HIAS-E-70, Discussion paper series from Hitotsubashi Institute for Advanced Study, Hitotsubashi University

Abstract: This paper provides the first very long term empirical examination of Piketty’s (2014) controversial hypothesis that inequality is increasing in r – g, (assets - real income). Using unique annual data on asset returns for a balanced portfolio and several other variables for the UK over the period 1210-2013, the study examines whether the dynamics in capital’s income share, SW, are governed by (r–g). The analysis confirms that r and g are robust and significant determinants of factor shares and that they have been the major forces behind the large inequality waves over the past eight centuries.

Keywords: Inequality and the (r-g)-gap; dynamics of inequality; inequality in the UK; 1210-2013 (search for similar items in EconPapers)
JEL-codes: E1 E2 O4 N1 N30 P1 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-gro, nep-his, nep-hpe and nep-mac
Date: 2018-06
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http://hermes-ir.lib.hit-u.ac.jp/rs/bitstream/10086/29260/1/070_hiasDP-E-70.pdf

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