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Mo#va#on:  Why  study  inequality?   1)  Inequality  is  a  defining  feature  of  Chile  and  all  of   La#n  America.  ...

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Mo#va#on:  Why  study  inequality?   1)  Inequality  is  a  defining  feature  of  Chile  and  all  of   La#n  America.   2)  Reducing  inequality  is  a  major  development  goal   in  the  region.   3)  You  can’t  assess  the  likely  impacts  of  popula#on   aging  without  understanding  inequality.   Consump#on  Inequality  in  Chile  

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Mo#va#on:  Why  study  inequality…     …using  NTA?   1)  NTA  focuses  on  consump#on  inequality   rather  than  on  income  inequality.   2)  NTA  provides  a  complete  picture  of  the  role   of  all  economic  ins#tu#ons:    labor  markets,   financial  markets,  governments,  and  families.   3)  NTA  promotes  dialogue  between  economists   and  demographers.   4)  NTA  provides  a  unified  framework  to  look  at   both  inequality  and  popula#on  aging.   Consump#on  Inequality  in  Chile  

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Methods   •  Divide  up  popula#on  based  on  educa#on  of   household  head  and  age  of  individual.   •  Why  use  educa#on  of  household  head  and  not   educa#on  of  individual?   •  We  use  5  years  age  groups  rather  than  single   year.   Consump#on  Inequality  in  Chile  

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Chilean  Popula#on  Donut  

Consump#on  Inequality  in  Chile  

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Chilean  Consump#on  Donut  

Consump#on  inequality:     High  and  persistent  across  age  

Consump#on  Inequality  in  Chile  

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Labor  earnings  

Consump#on  Inequality  in  Chile  

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Life  Cycle  Deficit:   Large  varia#on  across  groups  

Consump#on  Inequality  in  Chile  

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Consump#on  Financed  Very   Differently  Among  SES  Groups  

Consump#on  Inequality  in  Chile  

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How  is  consump#on  financed     among  elderly?  

Consump#on  Inequality  in  Chile  

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How  is  consump#on  financed     among  children?  

Consump#on  Inequality  in  Chile  

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Why  study  inequality     in  the  context  of  aging?            Diversity  within  countries  is  as  great  as              the  diversity  between  countries.  

Robin  Hood  Index.  

Robin  Hood  Index  for   Groups.  

The  propor#on  of   aggregate  income  which   The  propor#on  of   must  be  transferred   aggregate  income  which   from  rich  to  poor  to   must  be  transferred   reach  perfect  equality.   from  rich  groups  to   poor  groups  to  reach   perfect  equality   between  groups.   Consump#on  Inequality  in  Chile  

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“An  ounce  of  preven#on  is  worth  a   pound  of  cure.”    -­‐-­‐    Benjamin  Franklin   Robin  Hood  Index  for   Groups.  

Ben  Franklin  Index  for   Groups.  

The  propor#on  of   The  propor#on  of   aggregate  income  which   aggregate  income  which   must  be  transferred   must  be  invested  in   from  rich  groups  to   lower  educa#on  groups   poor  groups  to  reach   to  reach  the   perfect  equality   educa#onal  investment   between  groups.   of  the  highest  educa#on   group.   Consump#on  Inequality  in  Chile  

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6  ounces  of  preven#on  are  worth  a   pound  of  cure.  

Consump#on  Inequality  in  Chile  

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¡Gràcies!   Future  Work   1. Finish  the  paper.   2. Think  about  a  micro-­‐level  NTA  which  would   preserve  individual  level  data  and   rela#onships  between  individuals.   3.   We  need  a  country  or  countries  which  shows   us  what  equality  looks  like.       Consump#on  Inequality  in  Chile  

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