nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2008‒05‒24
five papers chosen by
Maximo Rossi
University of the Republic

  1. Job Satisfaction and Family Happiness: The Part-time Work Puzzle By Alison L. Booth; Jan Van Ours
  2. Inequality and Quiescence: A Continuing Conundrum By R. E. Pahl; David Rose; Liz Spencer
  3. Marital splits and income changes over the longer term By Stephen P. Jenkins
  4. Positional Concerns with Multiple Reference Points: Optimal Income Taxation and Public Goods in an OLG Model By Aronsson, Thomas; Johansson-Stenman, Olof
  5. Which Poverty Line? A Response to Reddy By Martin Ravallion

  1. By: Alison L. Booth (Department of Economics, University of Essex); Jan Van Ours (Tilburg University)
    Abstract: Using fixed effects ordered logit estimation, we investigate the relationship between part-time work and working hours satisfaction; job satisfaction; and life satisfaction. We account for interdependence within the family using data on partnered men and women from the British Household Panel Survey. We find that men have the highest hours-of-work satisfaction if they work full-time without overtime hours but neither their job satisfaction nor their life satisfaction are affected by how many hours they work. Life satisfaction is influenced only by whether or not they have a job. For women we are confronted with a puzzle. Hours satisfaction and job satisfaction indicate that women prefer part-time jobs irrespective of whether these are small or large. In contrast, female life satisfaction is virtually unaffected by hours of work. Women without children do not care about their hours of work at all, while women with children are significantly happier if they have a job regardless of how many hours it entails.
    Date: 2007–10
  2. By: R. E. Pahl (Institute for Social and Economic Research); David Rose (Institute for Social and Economic Research); Liz Spencer (New Perspectives)
    Abstract: How may we account for the fact that most people appear to accept widespread social and economic inequalities? This is a question that has often been posed in the social sciences. One possible explanation is that individuals tend to make comparisons with others like themselves and so, as a result, do not appreciate the full range of inequality. This was the conclusion drawn by research in the 1960s and was re-affirmed by further research in the 1970s. However, more recently, it has been suggested that social and economic change in the intervening period may have had effects on the range and type of comparisons people are able to make. In particular, it has been argued that the growth of the mass media has exposed people to a broader range of lifestyles and the expansion of the consumer society has created ever greater desires. In these circumstances, it is thought that people's horizons will have expanded so that they no longer have such restricted points of reference for their social comparisons. In this paper, we use evidence from a small scale pilot qualitative study to investigate social comparisons in the 21st century. We find that, in many ways, social comparisons are still narrow and knowledge of the true extent of inequality is still limited. What comparisons people do make appear to be based on lifestyle and consumption. Hence, they are neither resentful of the super-rich, nor of others closer to themselves who have done better in life. However, they are very aware of their advantages compared with less fortunate members of society. Our respondents see themselves as members of a comfortable middle mass of 'ordinary, hard-working families'. The paper concludes with some reflections on the nature of social cohesion in the UK today.
    Date: 2007–09
  3. By: Stephen P. Jenkins (Institute for Social and Economic Research)
    Abstract: What happens to people’s incomes when their or their parents’ marital union dissolves? Using data from waves 1–14 (survey years 1991–2004) of the British Household Panel Survey, I show that marital splits are associated with short-term declines in income for separating wives and children relative to separating husbands, but the size of the decline has declined over time markedly for women with children and this most likely reflects the effects of secularly rising employment rates and, related, the introduction of Working Families Tax Credit in 1998. Analysis of income trajectories suggests that in the five years following a marital split, incomes for separating wives recover but not to their previous levels.
    Keywords: benefits, divorce, family, income dynamics, poverty dynamics, programme participation, single parents, welfare to work, women, women and employment
    Date: 2008–02
  4. By: Aronsson, Thomas (Department of Economics, Umeå University); Johansson-Stenman, Olof (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper concerns optimal income taxation and provision of a state-variable public good under asymmetric information in a two-type overlapping generations model, where people care about their relative consumption. Each individual may compare his/her own current consumption with his/her own past consumption as well as with other people’s current and past consumption. The appearance of positional concerns affects the policy choices via two channels: (i) the size of the average degree of positionality and (ii) positionality differences between the (mimicked) low-ability type and the mimicker. Under plausible empirical estimates, the marginal labor income tax rates become substantially larger, and the absolute value of the marginal capital income tax rate of the low-ability type becomes substantially smaller, compared to the conventional optimal income tax model. The extent by which the rule for public provision should be modified depends crucially on the preference elicitation format.<p>
    Keywords: Optimal income taxation; asymmetric information; public goods; relative consumption; status; positional goods.
    JEL: D62 H21 H23 H41
    Date: 2008–05–19
  5. By: Martin Ravallion (World Bank)
    Abstract: Some years ago a consensus emerged in the development community on the idea of an international poverty line of around $1 a day at purchasing power parity. This became the focus of the first Millennium Development Goal (MDG), which calls for halving the 1990 $1 a day poverty rate by 2015. In a recent IPC One Pager, ?Are Estimates of Poverty in Latin America Reliable??, Sanjay Reddy asserts that this poverty line is ?arbitrary? and ?unreliable.? He feels that the line is too low to reflect well the cost of not being considered poor in Latin America.(...)
    Keywords: Some years ago a consensus emerged in the development community on the idea of an international poverty line of
    Date: 2008–05

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