The Department of Economics invites you to a Macro, Risk and Sustainability Seminar with Katja Mann, Copenhagen Business School.
This paper studies how digitalization affects consumption inequality. While previous literature has documented that technological change leads to U-shaped income polarization, we show that consumption and welfare responses resemble a J-shape. This is due to changes in consumer prices, which are more favorable for high earners. By assembling a novel dataset of digital technology in consumption, we establish that high-income households consume a larger share of digitally produced products, and that these products witness lower inflation. In a structural model that jointly considers income and price changes, we quantify the impact of digitalization on consumption inequality between 1960-2017.
If you have any questions regarding the seminar, please contact the seminar organizers Jonna Olsson or Camilla Nesfossen Hopsdal