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Inequality dynamics, underemployment, and secular stagnation

Research Project

Project/Area Number 21K13261
Research Category

Grant-in-Aid for Early-Career Scientists

Allocation TypeMulti-year Fund
Review Section Basic Section 07010:Economic theory-related
Research InstitutionSophia University

Principal Investigator

SCHLEGL Matthias  上智大学, 経済学部, 准教授 (50844982)

Project Period (FY) 2021-04-01 – 2026-03-31
Project Status Granted (Fiscal Year 2023)
Budget Amount *help
¥4,550,000 (Direct Cost: ¥3,500,000、Indirect Cost: ¥1,050,000)
Fiscal Year 2025: ¥780,000 (Direct Cost: ¥600,000、Indirect Cost: ¥180,000)
Fiscal Year 2024: ¥780,000 (Direct Cost: ¥600,000、Indirect Cost: ¥180,000)
Fiscal Year 2023: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000)
Fiscal Year 2022: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000)
Fiscal Year 2021: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000)
KeywordsInequality / Underemployment / Secular stagnation / Labor market / Unemployment / Wealth taxes / Macroeconomics / Rational bubble / Labour market / Wealth preference
Outline of Research at the Start

This research project uses modern macroeconomic models with features from behavioral economics to analyze inequality, underemployment and slowing economic growth as well as their interdependence. The goal is to provide for a better understanding and to contribute to the solution of these challenges.

Outline of Annual Research Achievements

My research agenda (joint with Japanese and international researchers) has seen considerable progress throughout the year with two major publications and one working paper.
In April 2023, our article on underemployment in the Japanese labor market was published in the Journal of Economic Theory. In July 2023, we published our analysis of rational bubbles as a result of a preference for wealth in the European Economic Review. In addition, our preliminary analysis of inequality dynamics in the presence of a preference for wealth is now available as a working paper. The analysis includes extensive numerical simulations of various policy interventions, such as wealth taxes, consumption taxes and levies. We are planning to submit this paper within the next year for publication.

Current Status of Research Progress
Current Status of Research Progress

1: Research has progressed more than it was originally planned.

Reason

Initially, we were quite concerned about the numerical solution of our model for the analysis of inequality dynamics as our algorithm failed to converge. However, we could eventually overcome the problems and successfully analyze the effects of various policy interventions.
In addition, progress on the extensions of the underemployment project has been very smoothly, in particular due to valuable feedback from referees of the published paper and participants of conferences.

Strategy for Future Research Activity

We are considering the following extensions of the research agenda:
Our analysis of wealth inequality dynamics is so far based on a real economic model without nominal frictions. In the next project, we are considering to add nominal rigidities (such as wage frictions and the zero lower bound on the interest rate) to analyse these dynamics under secular stagnation.
Our analysis of underemployment is based on a closed economy model with exogenous job destruction. We are currently working on an open economy version of the model and are also considering the possibility of endogeneous job destruction.

Report

(3 results)
  • 2023 Research-status Report
  • 2022 Research-status Report
  • 2021 Research-status Report
  • Research Products

    (8 results)

All 2023 2022 2021

All Journal Article (2 results) (of which Int'l Joint Research: 2 results,  Peer Reviewed: 2 results) Presentation (6 results) (of which Int'l Joint Research: 3 results,  Invited: 2 results)

  • [Journal Article] Structural unemployment, underemployment, and secular stagnation2023

    • Author(s)
      Ken-ichi Hashimoto, Yoshiyasu Ono and Matthias Schlegl
    • Journal Title

      Journal of Economic Theory

      Volume: 209

    • NAID

      40022347535

    • Related Report
      2023 Research-status Report 2022 Research-status Report
    • Peer Reviewed / Int'l Joint Research
  • [Journal Article] Wealth preference and rational bubbles2023

    • Author(s)
      Jean-Baptist Michau, Yoshiyasu Ono and Matthias Schlegl
    • Journal Title

      European Economic Review

      Volume: 156

    • NAID

      40022347204

    • Related Report
      2023 Research-status Report
    • Peer Reviewed / Int'l Joint Research
  • [Presentation] Structural unemployment, underemployment, and secular stagnation2023

    • Author(s)
      Ken-ichi Hashimoto, Yoshiyasu Ono and Matthias Schlegl
    • Organizer
      2023 Asian Meeting of the Econometric Society
    • Related Report
      2023 Research-status Report
    • Int'l Joint Research
  • [Presentation] Structural unemployment, underemployment, and secular stagnation2022

    • Author(s)
      Matthias Schlegl
    • Organizer
      Annual meeting of German Economic Society (VfS)
    • Related Report
      2022 Research-status Report
    • Int'l Joint Research
  • [Presentation] Structural unemployment, underemployment, and secular stagnation2022

    • Author(s)
      Matthias Schlegl
    • Organizer
      Annual meeting of German Economists Abroad (GEA)
    • Related Report
      2022 Research-status Report
  • [Presentation] The Seniority Structure of Sovereign Debt2022

    • Author(s)
      Matthias Schlegl (presenter), Christoph Trebesch, Mark Wright
    • Organizer
      Sophia Research Workshop in Economics
    • Related Report
      2021 Research-status Report
    • Invited
  • [Presentation] The Seniority Structure of Sovereign Debt2022

    • Author(s)
      Matthias Schlegl, Christoph Trebesch (presenter), Mark Wright
    • Organizer
      ASSA 2022 Virtual Annual Meeting
    • Related Report
      2021 Research-status Report
    • Int'l Joint Research
  • [Presentation] Structural unemployment, underemployment, and secular stagnation2021

    • Author(s)
      Ken-ichi Hashimoto, Yoshiyasu Ono, Matthias Schlegl (presenter)
    • Organizer
      Macro Research Seminar (Munich University)
    • Related Report
      2021 Research-status Report
    • Invited

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Published: 2021-04-28   Modified: 2024-12-25  

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