Central European Journal of Economic Modelling and Econometrics

We study the evolution of income and wealth inequality in an economy undergoing endogenous structural change with imperfect labor mobility. Our economy features two sectors: services and manufacturing. With faster TFP growth in manufacturing, labor reallocates from manufacturing to services. This reallocation is slower due to labor mobility frictions, which in turn, raises relative wages in services. As a result, income inequality is higher. Moreover, we study the impact of structural change on wealth inequality. Its economic intuition is more ambiguous. On the one hand, increased income dispersion implies increased dispersion in the ability to accumulate wealth across individuals. On the other hand, younger workers who hold the least assets are the most mobile across sectors. Their incomes are improved, which boosts their savings, which works towards equalizing wealth distribution. The consequence of these changes can only be verified with a computational model. To this end, we construct an overlapping generations model with two sectors: manufacturing and services. Our model also features heterogeneous individuals. With our model, we are able to show how the structural change affected the evolution of income and wealth inequality in Poland as of 1990.

In the management of human resources, the absences are monitored with Bradford Factor (BF) using the number and length of sick leaves. The sick leaves are also measured in health technology to assess the impact of health technologies on product loss, aka indirect cost (IC). Linking the BF and IC might promote BF as an outcome measure and facilitate the estimation of IC. We simulate a single company operation in several scenarios describing the firm's functioning and adjustments to workers' absence. We measure the BF and the IC due to absence and relate them with econometric modelling. Results show that BF and IC are associated in a non-linear way; hence, IC cannot be calculated from BF in a simple manner. The association is strongest for possibility to adjust to worker's absence, and a high elasticity of substitution between workers. Therefore, the possibility to proxy IC by BF is rather limited.

Due to the spike in inflation, the implementation of easy monetary and fiscal policies since the pandemic appears to be coming to an end. The shift towards tighter policies raises concerns about debt sustainability in developing countries, particularly due to the challenge of the "original sin" problem. Given these premises, to analyze debt sustainability for emerging countries, this study focuses on foreign exchange revenue capability and employs external debt-creating (imports, reserves and interest payments) and reducing variables (exports, reserve return and net transfers) for 1995-2020. The results of this panel cointegration estimation for 15 EMDE countries are 0.74 and 0.70 for CCEMG and AMG estimators respectively which indicates moderate sustainability as whole sample countries. However, the individual estimators vary widely for each individual country from weak to strong sustainability.