A0435
Title: Bayesian analysis of aging and declining household size effects on income distribution in Japan
Authors: Kazuhiko Kakamu - Nagoya City University (Japan) [presenting]
Abstract: A novel dynamic model is proposed to estimate income distributions from grouped data while simultaneously examining the factors driving changes in income distribution. Assuming that the underlying income distribution follows a generalized beta distribution of the second kind, the state-space model is extended to develop a dynamic framework. The model parameters are estimated using the Markov chain Monte Carlo method. Utilizing Japanese household survey data, the impact of population aging and declining household size is investigated on income distribution in Japan. The empirical results confirm that both aging and household size influence income inequality. Specifically, both factors contribute to an increase in the proportion of lower-income households, thereby exacerbating income inequality.
