RIWAG -REDUCING INEQUALITY WITHIN AND ACROSS GENERATIONS

During the last decades inequality has risen not only in respect to income and wealth but also in respect to health and longevity (e.g. Chetty et al., 2016; Case and Deaton, 2017). To understand the recent trends in inequality, it is important to consider that people are most vulnerable during childhood and during old age. This fact has triggered a specific interest in the evolution of inequality over the life course (e.g. National Academies of Sciences, Engineering, and Medicine, 2015; OECD, 2017). The aim of this project is to provide a unified framework for studying and mitigating the economic and demographic consequences of increasing inequality in European countries. To do so, the RIWAG project pursues several important objectives: 1. To construct a rich life-cycle model to trace out how initial heterogeneity is transmitted into unequal behaviours and outcomes over the lifecycle. 2. To study how different policies lead to different dynamics over the lifecycle and how this affects intra-generational inequality. 3. To integrate the life-cycle model into a general equilibrium framework to study how inequality evolves across cohorts (inter-generational inequality). 4. To explore the scope for policy-making in mitigating inequality within and across cohorts.