Nº 42 (October, 2006). Martín Guzmán & Ezequiel Molina.
“Desigualdad e instituciones en una dimensión intertemporal”.
This paper analyzes the importance of institutions for the income distribution. We present a model where only the variance changes and the mean remains the same (assuming that there is no investment). We obtain that changes in the distribution depend on the initial institutional conditions. This finding is studied formally and also with empirical data which supports the theoretical framework.