Vesa-Matti Heikkuri

vesa-matti_heikkuri at

Department of Economics
Brown University


I am a PhD Candidate at the Department of Economics at Brown University. My research focuses on economic inequality, demographic economics, and macroeconomics. I am on the 2022-23 economics job market.

Working papers

Job market paper 1: Population Aging, Cohort Replacement, and the Evolution of Income Inequality in the United States (with Matthias Schief) Latest version

We study how demographic change affects the evolution of household income inequality in the United States both historically and prospectively. We emphasize the distinct roles of population aging and cohort replacement, and develop a methodology to study their joint compositional effect on income inequality. In the process, we also develop a novel methodology to aggregate sub-population Gini coefficients into a population-level Gini coefficient based on the principle of maximum entropy. We find that rising income inequality is embodied in birth cohorts born since the mid-20th century and that most of the increase in inequality over the past two decades can be accounted for by demographic change. Furthermore, we predict that demographic change over the next two decades will lead to further increase of the Gini coefficient by one to six percentage points.

Job market paper 2: Subgroup Decomposition of the Gini Coefficient: A New Solution to an Old Problem (with Matthias Schief) Latest version

We study inequality decomposition by population subgroups. We define properties of a satisfactory decomposition and ask what these properties imply for the decomposition of familiar inequality indices. We find that the Gini coefficient, the generalized entropy indices, and the Foster-Shneyerov indices all admit satisfactory decomposition formulas derived from a common set of axioms. While our axiomatic approach recovers the known decomposition formulas for the generalized entropy and the Foster-Shneyerov indices, it leads us to a novel decomposition formula for the Gini coefficient. The decomposition of the Gini coefficient is easy to compute, and it has both a geometric and an arithmetic intuition.

Work in progress

On the Determinacy of Equilibrium in a Continuous-time Overlapping Generations Model

Institutional Changes and the Allocation of Talent: Macroeconomic Effects of a School Reform in Finland (with Cosimo Petracchi and Matthias Schief)

Tight Bounds for the Gini Coefficient of Composite Populations (with Matthias Schief)
Plain Academic