nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2008‒10‒07
ten papers chosen by
Maximo Rossi
University of the Republic

  1. Unemployment as a social norm in Germany By Andrew E. Clark; Andreas Knabe; Steffen Rätzel
  2. Economic satisfaction and income rank in small neighbourhoods By Andrew E. Clark; Nicolai Kristensen; Niels Westergård-Nielsen
  3. Global Poverty Reassessed: A Reply to Reddy By Martin Ravallion
  4. A Crowding-out Effect for Relative Income By Benno Torgler; Bruno S. Frey; Markus Schaffner; Sascha L. Schmidt
  5. Noblesse Oblige? Determinants of Survival in a Life and Death Situation By Bruno S. Frey; David A. Savage; Benno Torgler
  6. Inequality Aversion and Performance in and on the Field By Benno Torgler; Markus Schaffner; Bruno S. Frey; Sascha L. Schmidt; Uwe Dulleck
  7. Poverty among minorities in the United States: Explaining the racial poverty gap for Blacks and Latinos By Carlos Gradin
  8. On analysing the world distribution of income By Anthony B. Atkinson; Andrea Brandolini
  9. The Transmission of Women's Fertility, Human Capital and Work Orientation Across Immigrant Generations By Francine D. Blau; Lawrence M. Kahn; Albert Yung-Hsu Liu; Kerry L. Papps
  10. Gender, Source Country Characteristics and Labor Market Assimilation Among Immigrants: 1980-2000 By Francine D. Blau; Lawrence M. Kahn; Kerry L. Papps

  1. By: Andrew E. Clark; Andreas Knabe; Steffen Rätzel
    Abstract: This paper investigates the relationship between the subjective well-being of both the employed and unemployed and regional unemployment rates. While employed men suffer from regional unemployment, unemployed men are significantly less negatively affected. This is consistent with a social-norm effect of unemployment in Germany. We find no evidence of such an offsetting effect for women.
    Date: 2008
    URL: http://d.repec.org/n?u=RePEc:pse:psecon:2008-45&r=ltv
  2. By: Andrew E. Clark; Nicolai Kristensen; Niels Westergård-Nielsen
    Abstract: We contribute to the literature on well-being and comparisons by appealing to new Danish data dividing the country up into around 9000 small neighbourhoods. Administrative data provides us with the income of every person in each of these neighbourhoods. This income information is matched to demographic and economic satisfaction variables from eight years of Danish ECHP data. Panel regression analysis shows that, conditional on own household income, respondents report higher satisfaction levels when their neighbours are richer. However, the individuals are rank-sensitive: conditional on own income and neighbourhood median income, individuals are more satisfied as their percentile neighbourhood ranking improves. A ten percentage point rise in rank (i.e. from 40 th to 20 th position in a 200-household cell) is worth 0.11 on a one to six scale, which is a large marginal effect in satisfaction terms.
    Date: 2008
    URL: http://d.repec.org/n?u=RePEc:pse:psecon:2008-44&r=ltv
  3. By: Martin Ravallion (World Bank)
    Abstract: In ?One Pager? No. 65, Sanjay Reddy says the World Bank is ?digging (itself) deeper into a hole? in measuring global poverty. It seems we are in this hole (in Reddy?s eyes) because we have not adopted his preferred method; I have tried to explain why we have not done so in past responses to Reddy (including Ravallion, 2008). (...)
    Keywords: Global Poverty Reassessed: A Reply to Reddy
    Date: 2008–09
    URL: http://d.repec.org/n?u=RePEc:ipc:opager:66&r=ltv
  4. By: Benno Torgler; Bruno S. Frey; Markus Schaffner; Sascha L. Schmidt
    Abstract: The risk of external interventions crowding-out intrinsic motivation has long been established in economics. This paper introduces a new dimension by arguing that a crowding-out effect does become possible if individuals receive higher relative compensation. Using a unique, large data set that focuses on 26 seasons in basketball (NBA) we find empirical support for a relative crowding-out effect. Performance is reduced as a reaction to a relative income advantage.
    Keywords: Crowding-out; relative income; positional concerns; motivation
    JEL: D00 D60 L83
    Date: 2008–09
    URL: http://d.repec.org/n?u=RePEc:cra:wpaper:2008-20&r=ltv
  5. By: Bruno S. Frey; David A. Savage; Benno Torgler
    Abstract: This paper explored the determinants of survival in a life and death situation created by an external and unpredictable shock. We are interested to see whether pro-social behaviour matters in such extreme situations. We therefore focus on the sinking of the RMS Titanic as a quasi-natural experiment do provide behavioural evidence which is rare in such a controlled and life threatening event. The empirical results support that social norm such as “women and children first” survive in such an environment. We also observe that women of reproductive age have a higher probability of surviving among women. On the other hand, we observe that crew members used their information advantage and their better access to resources (e.g. lifeboats) to generate a higher probability of surviving. The paper also finds that passenger class, fitness, group size, and cultural background matter.
    Keywords: Decision under Pressure; Altruism; Social Norms; Interdependent Preferences; Excess of Demand
    JEL: D63 D64 D71 D81
    Date: 2008–09
    URL: http://d.repec.org/n?u=RePEc:cra:wpaper:2008-21&r=ltv
  6. By: Benno Torgler; Markus Schaffner; Bruno S. Frey; Sascha L. Schmidt; Uwe Dulleck
    Abstract: The experimental literature and studies using survey data have established that people care a great deal about their relative economic position and not solely, as standard economic theory assumes, about their absolute economic position. Individuals are concerned about social comparisons. However, behavioral evidence in the field is rare. This paper provides an empirical analysis, testing the model of inequality aversion using two unique panel data sets for basketball and soccer players. We find support that the concept of inequality aversion helps to understand how the relative income situation affects performance in a real competitive environment with real tasks and real incentives.
    Keywords: Inequality aversion; relative income; positional concerns; envy; social comparison; performance; interdependent preferences
    JEL: D00 D60 L83
    Date: 2008–09
    URL: http://d.repec.org/n?u=RePEc:cra:wpaper:2008-18&r=ltv
  7. By: Carlos Gradin (Universidade de Vigo)
    Abstract: The two largest minorities in the United States, African Americans and people of Hispanic origin, show official poverty rates that are at least twice as high as those among non-Hispanic Whites. These similarly high poverty rates among minorities are, however, the result of different combinations of factors, due to the specific characteristics of these two groups. In this paper, we analyze the role of demographic and labor-related variables in explaining the current differential in poverty rates among racial and ethnic groups in the United States and its recent evolution. Our results show, first, that these differentials were largely explained by differing family characteristics of the ethnic groups. Furthermore, we show that while labor market activity of family members and a preponderance of single mothers played a more significant role in explaining the higher poverty rates of Blacks, a larger number of dependent children is more closely associated with higher poverty among Latinos, who also suffer from a larger educational attainment gap and higher immigration rates. Finally, we show that both racial poverty gaps declined during the 1990s, and, in the case of Latinos, the downward trend has continued through the present decade. This reduction in the differentials was fully explained by characteristics, mainly the labor market performance of family heads, while the unexplained differential (conditional racial poverty gap) proved to be more persistent across time.
    Keywords: poverty, gap, race, decomposition, Oaxaca-Blinder, United States, CPS, labor market, participation, education, family characteristics.
    JEL: D31 D63 J15 J82 O15
    Date: 2008
    URL: http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2008-96&r=ltv
  8. By: Anthony B. Atkinson (Nuffield College, Oxford); Andrea Brandolini (Bank of Italy, Department for Structural Analysis)
    Abstract: This paper argues that consideration of world inequality should cause us to re-examine the key concepts underlying the welfare approach to the measurement of income inequality and the inter-relation between the measurement of inequality and the measurement of poverty. There are three reasons why we feel that a re-examination is necessary: (i) the extent of global income differences means that we cannot simply carry over the methods used at a national level; we need a more flexible measure; (ii) we have to reconcile measures of world inequality and world poverty; and (iii) we need to explore more fully the different ways in which measures may be relative or absolute. This leads us to propose a new measure, which (a) combines poverty and inequality, including provision for those who are concerned only with poverty, (b) incorporates different approaches to the measurement of inequality; and (c) allows the cost of inequality to be expressed in different ways. Applied to the world distribution for the period 1820-1992, the new measure provides different perspectives on the evolution of global inequality.
    Keywords: global income inequality, absolute vs. relative inequality, poverty, world citizens.
    JEL: D31 C80
    Date: 2008
    URL: http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2008-97&r=ltv
  9. By: Francine D. Blau; Lawrence M. Kahn; Albert Yung-Hsu Liu; Kerry L. Papps
    Abstract: Using 1995-2006 Current Population Survey and 1970-2000 Census data, we study the intergenerational transmission of fertility, human capital and work orientation of immigrants to their US-born children. We find that second-generation women's fertility and labor supply are significantly positively affected by the immigrant generation's fertility and labor supply respectively, with the effect of mother's fertility and labor supply larger than that of women from the father's source country. The second generation's education levels are also significantly positively affected by that of their parents, with a stronger effect of father's than mother's education. Second-generation women's schooling levels are negatively affected by immigrant fertility, suggesting a quality-quantity tradeoff for immigrant families. We find higher transmission rates for immigrant fertility to the second generation than we do for labor supply or education: after one generation, 40-65% of any immigrant excess fertility will remain, but only 12-18 % of any immigrant annual hours shortfall and 18-36% of any immigrant educational shortfall. These results suggest a considerable amount of assimilation across generations toward native levels of schooling and labor supply, although fertility effects show more persistence.
    JEL: J1 J16 J22 J24 J61
    Date: 2008–10
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:14388&r=ltv
  10. By: Francine D. Blau; Lawrence M. Kahn; Kerry L. Papps
    Abstract: We use 1980, 1990 and 2000 Census data to study the impact of source country characteristics on the labor supply assimilation profiles of married adult immigrant women and men. Women migrating from countries where women have high relative labor force participation rates work substantially more than women coming from countries with lower relative female labor supply rates, and this gap is roughly constant with time in the United States. These differences are substantial and hold up even when we control for wage offers and family formation decisions, as well as when we control for the emigration rate from the United States to the source country. Men's labor supply assimilation profiles are unaffected by source country female labor supply, a result that suggests that the female findings reflect notions of gender roles rather than overall work orientation. Findings for another indicator of traditional gender roles, source country fertility rates, are broadly similar, with substantial and persistent negative effects of source country fertility on the labor supply of female immigrants except when we control for presence of children, in which case the negative effects only become evident after ten years in the United States.
    JEL: J16 J22 J24 J61
    Date: 2008–10
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:14387&r=ltv

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