Inequality dynamics, underemployment, and secular stagnation

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My research agenda (joint with Japanese and international researchers) consists of a series of interrelated projects that analyze empirical phenomena, such as inequality and underemployment in the labour market, by combining standard macroeconomic models with features from behavioural economics, specifically a preference for wealth. This year has seen substantial progress on the following two projects.In the inequality project, we have substantially revised our model framework to allow for the possibility of technological progess and capital adjustment costs, in addition to wealth preference shocks, income and liquidity risks. We have calibrated this model to match empirical features of the U.S. wealth distribution and are currently analyzing the effects of various tax schemes (based on actual tax plans from U.S. politicians) on the wealth distribution using numerical simulations based on mean-field game formulations. Our goal is to summarize our results in a full draft of the paper within the next months.In the labour market project, we study the simultaneous occurrence of unemployment and underemployment in the Japanese labour market. Having received constructive feedback from referees and journal editiors, we have substantially revised this paper including both the theoretical model and the numerical simulations. This revised version has been accepted for publication in the Journal of Economic Theory in April 2023.