Sacrifice ratios and the income distribution: Stylized facts for OECD countries

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Authors:
Laura Acevedoa,
Marc Hofstettere

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Luis E. Arango, Leonardo Bonilla-Mejía, Luz Adriana Flórez, Luis E. Arango

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Edgar Caicedo-García, Jorge Enrique Ramos-Forero, Hernán Rincón-Castro, Hector Manuel Zárate-Solano

This paper examines the distributional consequences of disinflation by estimating sacrifice ratios  (percentage output losses relative to the change in inflation) for different income quintiles and the top 1% of the income distribution. We find that at the tails of the distribution the average percentage output losses are considerably higher than at the center: 1.7 times greater at the left tail, 2.7 times greater at the top 1%.