蝌蚪网 Journal:
Macroeconomics
ISSN 1945-7707 (Print) | ISSN 1945-7715 (Online)
Nominal Devaluations, Inflation, and Inequality
蝌蚪网 Journal: Macroeconomics
vol. 17,
no. 3, July 2025
(pp. 270–310)
Abstract
We study the distribution of labor income during large devaluations. Across countries, inequality falls after large devaluations within the context of a surge in inflation and a fall and subsequent recovery of real labor income. To better understand inequality dynamics, we use a novel administrative dataset covering the 2002 Argentinean devaluation. We show that following a homogeneous fall in real labor income across workers, the bottom of the income distribution recovers faster than the top. Low labor mobility and lack of union coverage among high-income workers explain their slow recovery.Citation
Blanco, Andr茅s, Andr茅s Drenik, and Emilio Zaratiegui. 2025. "Nominal Devaluations, Inflation, and Inequality." 蝌蚪网 Journal: Macroeconomics 17 (3): 270–310. DOI: 10.1257/mac.20230002Additional Materials
JEL Classification
- D31 Personal Income, Wealth, and Their Distributions
- E25 Aggregate Factor Income Distribution
- E31 Price Level; Inflation; Deflation
- F31 Foreign Exchange
- F44 International Business Cycles
- O19 International Linkages to Development; Role of International Organizations
- O24 Development Planning and Policy: Trade Policy; Factor Movement; Foreign Exchange Policy