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Revisiting global imbalances: A comparative analysis of income and consumption inequality

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  • Li Sheng
  • Zhaoyong Zhang

Abstract

This article presents a simple model that reveals the reverse relation of the ratio of current account balance to inequality in income and consumption. Consumption smoothing schemes have been aggregated, among which the linchpin is a policy intervention that mitigates the worsening consumption inequality problem. However, in the long run, short‐sighted policies could have a corresponding impact on current accounts.

Suggested Citation

  • Li Sheng & Zhaoyong Zhang, 2022. "Revisiting global imbalances: A comparative analysis of income and consumption inequality," Economics and Politics, Wiley Blackwell, vol. 34(2), pages 382-390, July.
    • Handle: RePEc:bla:ecopol:v:34:y:2022:i:2:p:382-390
    DOI: 10.1111/ecpo.12202
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