Markus Pettersson: latest PhD graduate from the Department of Economics
Markus Pettersson’s dissertation is entitled Growth, Inflation, and Household Heterogeneity and consists of three self-contained chapters. As the title suggests, Markus’ research focuses on how heterogeneity at the household level interacts with growth and inflation at the macroeconomic level.
Chapter 1 investigates how current demographic trends impact output per capita. It is often thought that the current ageing of the population is harmful for GDP per capita due to a shrinking share of working-age households in the population. Chapter 1 emphasizes a counteracting mechanism: increasing life expectancy also leads to more research and development and technological progress, which more than offsets the negative impact on the population share of working-age households.
Chapters 2 and 3 study how inflation varies with household income. It is acknowledged that because consumption patterns differ systematically between rich and poor consumers, they should also experience different rates of inflation. Yet, these differences are difficult to measure in a satisfactory way. Chapters 2 and 3 develop a new method in this regard and use it to measure and analyze inflation inequality in the United States over the last 2-3 decades.