Christian Alexander Belabed studied Economics at Johannes-Kepler-University Linz (Austria) from 2003 to 2010. He has worked as a research assistant at the Department of Economics at JKU Linz and the Institute for Comprehensive Analysis of Economy Linz. In October 2011 he started his PhD studies at JKU Linz (supervisors: Rainer Bartel and Martin Riese) and gained a doctoral student position at the Macroeconomic Policy Institute (IMK) at Hans Boeckler Foundation in Düsseldorf. Christian’s research interests include macroeconomic theory and the history of financial crises.
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[PART 2] U.S. Current Account Deficits and German Surpluses: The Role of Income Distribution in Global Imbalances
In our two papers, we analyze how changes in personal and functional (wages versus profits) income distribution interact to produce different macroeconomic outcomes in different countries. On the basis of a stock-flow consistent model calibrated for the United States, Germany, and China, simulations suggest that a substantial part of the increase in household debt and the decrease in the current account in the United States since the early 1980s can be explained by the interplay of rising (top-end) household income inequality and certain institutions (e.g. easy access to credit, privately financed education and health care systems).
We develop a three-country, stock-flow consistent macroeconomic model to study the effects of changes in both personal and functional income distribution on national current account balances.
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Institute for New Economic Thinking grantees Christian Belabed and Thomas Theobald and their co-authors have revived this old theory as a hypothesis to explain the apparent statistical link between rising income inequality and current account deficits.