nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2005‒02‒20
five papers chosen by
Maximo Rossi
Universidad de la República

  1. Measuring polarization, inequality, welfare and poverty By Juan Gabriel Rodríguez
  2. The Distribution of Wages in Poland, 1992-2002 By Newell, Andrew; Socha, Mieczyslaw W.
  3. What Can Happiness Research Tell Us About Altruism? Evidence from the German Socio-Economic Panel By Schwarze, Johannes; Winkelmann, Rainer
  4. Does Educational Tracking Affect Performance and Inequality? Differences-in-Differences Evidence across Countries By Eric A. Hanushek; Ludger Woessmann
  5. A Dominance Approach to Well-Being Inequality Across Countries By Christophe Muller; Alain Trannoy

  1. By: Juan Gabriel Rodríguez (Universidad Rey Juan Carlos de Madrid e Instituto de Estudios Fiscales)
    Abstract: This paper analyzes the relationship between polarization and inequality, welfare and poverty measures. First, the Wolfson polarization measure is generalized in terms of the between-groups and within-groups Gini components for income groups separated by any z income value. Second, it is shown that polarization is the difference between the welfare levels of rich and poor income groups when feelings of identification between individuals are based on their utility functions. Third, the proposed polarization measure is a function of the Sen poverty index, its extension due to Shorrocks (1995) and the normalized poverty deficit index when the z income value represents the poverty line. In addition, these results are linked to the Esteban and Ray (1994) and Esteban et al. (1999) polarization measures.
    Keywords: polarization, inequality, welfare, poverty.
    JEL: D39 D63 H30
    Date: 2004
  2. By: Newell, Andrew (University of Sussex and IZA Bonn); Socha, Mieczyslaw W. (University of Warsaw)
    Abstract: This paper analyses the changes in the size distribution of wages in Poland over a decade of transition. Until about 1998 there were some forces tending to increase wage inequality and other forces contracting it. The result was a relatively constant level of inequality. Privatisation was the main force tending to increase wage inequality, partly because it generated major increases in the relative wages of professional and managerial workers. We demonstrate how private firms tend to pay less at the bottom end of the wage distribution and more at the top end. The main force contracting the variance of wages was the decline, between 1992 and 1998 in labour market participation of those with low levels of education. Wage inequality seems to have increased since 2000. Suggestively, whereas privatisation has continued, the decline in participation has halted.
    Keywords: wages, Poland
    JEL: J31 P23
    Date: 2005–02
  3. By: Schwarze, Johannes (University of Bamberg, DIW Berlin and IZA Bonn); Winkelmann, Rainer (University of Zurich, CEPR and IZA Bonn)
    Abstract: Much progress has been made in recent years on developing and applying a direct measure of utility using survey questions on subjective well-being. In this paper we explore whether this new type of measurement can be fruitfully applied to the study of interdependent utility in general, and altruism between parents and children in particular. We introduce an appropriate econometric methodology and, using data from the German Socio-Economic Panel for the years 2000-2002, find that the parents’ self-reported happiness depends positively, albeit not very strongly, on the happiness of adult children who moved out.
    Keywords: utility function, extended family, fixed effects, ordered probit
    JEL: D6 D64 C25 J10
    Date: 2005–02
  4. By: Eric A. Hanushek; Ludger Woessmann
    Abstract: Even though some countries track students into differing-ability schools by age 10, others keep their entire secondary-school system comprehensive. To estimate the effects of such institutional differences in the face of country heterogeneity, we employ an international differences-in-differences approach. We identify tracking effects by comparing differences in outcome between primary and secondary school across tracked and non-tracked systems. Six international student assessments provide eight pairs of achievement contrasts for between 18 and 26 cross-country comparisons. The results suggest that early tracking increases educational inequality. While less clear, there is also a tendency for early tracking to reduce mean performance. Therefore, there does not appear to be any equity-efficiency trade-off.
    JEL: I2
    Date: 2005–02
  5. By: Christophe Muller (Departamento de Fundamentos del An‡lisis Economico, Universidad de Alicante, Alicante, Spain.); Alain Trannoy (EHESS, GREQAM-IDEP)
    Abstract: This paper proposes a dominance approach to study well-being in-equality across countries at the world level. We consider a class of well-being indices based on the three attributes considered in the HDI (Human Development Index). Indices are required to satisfy preference for egali-tarian marginal distributions of income, health and education, inclination for less correlation between attributes and priority to poor countries for allocating funds to improve health and education. We exhibit su ¥cient conditions which are easy to implement to check dominance over the de-fined class of well-being
    Keywords: Multidimensioned Welfare; Multivariate Inequality, Well-Being Dimensions, Human Development Index
    JEL: O15 D31
    Date: 2003–11

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