Daniel Albuquerque

Welcome to my website!

I am a Research Economist in the Monetary Analysis Directorate at the Bank of England.

My research interests are in Macroeconomics and related to Inequality and Monetary Policy.

Here is my CV.

email: d.albuquerque.econ "at" gmail "dot" com

Working Papers

The Racial Wealth Gap: the Role of Entrepreneurship (with Tomer Ifergane)
The racial wealth gap is one of the most striking and persistent disparities between Black and White households in the US. We study the determinants of this gap using a general equilibrium incomplete market model featuring dynamic discrete entrepreneurship choice and an empirically estimated income process. In the model, Black households face: (i) higher capital costs as entrepreneurs; (ii) a labour-income gap; and (iii) greater non-employment risk. We find that access to capital for Black entrepreneurs accounts for most of the racial wealth gap. Our model demonstrates that wealth transfers without social change cannot permanently address this gap and points towards addressing barriers faced by Black entrepreneurs as a key margin of intervention.

Portfolio Changes and Wealth Inequality Dynamics (new draft coming soon!)
This paper investigates the role of changes in households’ portfolios on the evolution of wealth inequality. First, I show that US households’ portfolio composition has changed between 1989 and 2019. Using an accounting exercise, I quantify that these changes account for 2.4 p.p. of the total 7.8 p.p. increase in the wealth share of the top 1%, mainly due to wealthy households holding a rising amount of high-risk, high-return assets. Second, I analyse whether these changes in portfolios at the top can be caused by changes in income taxation. With an analytical model I show that when taxes fall households shift their portfolio towards high-risk, high-return assets, magnifying the impact of tax rates on wealth inequality. Third, I develop a quantitative model of households’ savings and portfolio choice and analyse the decrease in US tax rate progressivity since 1975. Allowing households to react by changing their portfolio composition amplifies the impact of taxes on the top 1% wealth share by approximately 20% from 1975 to 2019, and by 25% when in the new steady state.