Social status pursuit, distribution of bequests and inequality
Embargo Lift Date: 2022-06-28
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The quest for social status modifieslifetime decisionsand as a consequence, the trajectory ofthe overall economy.Focusing on the relative wealth dimension of social status, we build a two-period overlapping generations modelwith heterogeneous agents to investigate the effects of status quest on the evolution of bequest distribution andhousehold inequality. We show that the bequest motive and the concern for social status not only increase thestationary level of capital but also enhance the household equality.