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Issue 5(1), October 2010 -- Paper Abstracts

Girard  (p. 9-22)

Cooper (p. 23-32)

Kunz-Osborne (p. 33-41)

Coulmas-Law (p.42-46)

Stasio (p. 47-56)

Albert-Valette-Florence (p.57-63)

Zhang-Rauch (p. 64-70)

Alam-Yasin (p. 71-78)

Mattare-Monahan-Shah (p. 79-94)

Nonis-Hudson-Hunt (p. 95-106)

JOURNAL OF APPLIED BUSINESS AND ECONOMICS

Distribution Matters: The Reverse Robin-Hood Macroeconomic Effects

Author(s): Loreto Peter Alonzi, Anne Drougas, Daniel Condon

Citation: Loreto Peter Alonzi, Anne Drougas, Daniel Condon, (2018) "Distribution Matters: The Reverse Robin-Hood Macroeconomic Effects," Journal of Applied Business and Economics, Vol. 20, Iss.1,  pp. 19-36

Article Type: Research paper

Publisher: North American Business Press

Abstract:

This paper examines income distribution’s impact on aggregate demand. Income distribution is introduced by replacing consumption as a function of aggregate income with consumption as the sum of two consumptions: a high income group’s and low income group’s. Notably the high income group’s MPC is assumed to be less than the lower income group’s. Analysis reveals two key results. As the high income group’s proportion of income rises: (1) aggregate demand falls and (2) autonomous spending changes cause smaller aggregate demand shifts. A reduced multiplier is the key. Empirical work supports the assumption that the high income group’s MPC is less than the low income group’s.