Christian Belabed and Thomas Theobald: Inequality and the Current Account

The video discusses a project by doctoral students and a professor at the Macroeconomic Policy Institute in Germany, exploring the link between income inequality, household debt, and current account imbalances. The project revives the relative income hypothesis, suggesting that consumption behavior is influenced by income distribution. The discussion includes institutional factors and country comparisons, particularly between the US, Germany, and China. The project employs various economic models and emphasizes the importance of integrating social psychology into economic thinking.

In what ways do the students believe the relative income hypothesis may differ in application between countries?

How do the students coordinate their work on the project?

What is the significance of the financial crisis in shaping the research interests of the students?

What is the historical context that led to the students' interest in income inequality?