nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2008‒11‒11
six papers chosen by
Maximo Rossi
University of the Republic

  1. Do Redistributive Pension Systems Increase Inequalities and Welfare? By Christophe Hachon
  2. Social protection performance in the European Union: comparison and convergence By COELLI, Tim; LEFEBVRE, Mathieu; PESTIEAU, Pierre
  3. Decomposing Cross-Country Gaps in Obesity and Overweight: Does the Social Environment Matter? By Joan Costa-Font; Daniele Fabbri; Joan Gil
  4. Temporary and Persistent Poverty among Ethnic Minorities and the Majority in Rural China By Gustafsson, Björn; Sai, Ding
  5. Measuring Richness and Poverty: A Micro Data Application to Europe and Germany By Peichl, Andreas; Schaefer, Thilo; Scheicher, Christoph
  6. Intergenerational Top Income Mobility in Sweden – A Combination of Equal Opportunity and Capitalistic Dynasties By Björklund, Anders; Roine, Jesper; Waldenström, Daniel

  1. By: Christophe Hachon (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I)
    Abstract: Using a capital-skill complementarity technology, we analytically show that an increase in the direct redistributivity of Pay-As-You-Go (PAYG) pension systems has a positive impact on wages and on wage inequalities. We also show that life expectancyinequalities play an important role in the achievement of these results. Then, we calibrate our model and we and that, if life expectancy inequalities are suffciently high, a more redistributive pension system increases the wealth and the welfare of every agent of the economy. Moreover, such a policy decreases the tax rate of the pension system.
    Keywords: Inequality, Pension System, Redistribution, Capital-Skill Complementarity
    Date: 2008–06–04
  2. By: COELLI, Tim (CEPA, University of Queensland); LEFEBVRE, Mathieu (CREPP, Université de Liège); PESTIEAU, Pierre (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))
    Abstract: In this paper we use data on five social inclusion indicators (poverty, inequality, unemployment, education and health) to assess the performance of 15 European welfare states (EU15) over a ten-year period from 1995 to 2004. Aggregate measures of performance are obtained using index number methods similar to those employed in the construction of the widely used Human Development Index (HDI). These are compared with alternative measures derived from data envelopment analysis (DEA) methods. The influence of methodology choice and the assumptions made in scaling indicators upon the results obtained is illustrated and discussed. We also analyse the evolution of performance over time, finding evidence of some convergence in performance and no sign of social dumping.
    Keywords: performance measure, best practice frontier, social protection.
    JEL: H50 C14 D24
    Date: 2008–03
  3. By: Joan Costa-Font; Daniele Fabbri; Joan Gil (Universitat de Barcelona)
    Abstract: A key question underpinning health production, and one that remains relatively unexplored, is the influence of socio-economic and environmental factors on weight gain and obesity. Such issues acquire particular relevance when data from two Mediterranean countries (Italy and Spain) are compared. Interestingly, the obesity rate was 5 percentage points higher in Spain in 2003 while in 1990 it had been roughly the same in the two countries. This paper reports a non-linear decomposition of gaps in overweight (body mass index BMI - between 25 and 29.9 kg/m2), class 1 (BMI30 kg/m2) and class 2 obesity (BMI35 kg/m2) between Spain and Italy by both gender and age. We isolate the influence of lifestyles, socioeconomic and environmental effects in explaining cross-country gaps in the prevalence of obesity. Our findings suggest that when the social environment (peer effects) is not controlled for, eating habits and education are the main predictors of total cross-country gaps (36-52%), albeit that these two factors have a different impact depending on gender and age. Somewhat paradoxically, however, when we controlled for the social environment, these previous predictors lost their explanatory power and peer effects were found to explain between 46 and 76% of gaps and to exhibit an increasing age pattern.
    Keywords: italy, obesity gaps, obesity, education, non-linear decomposition, spain
    JEL: I19 I18 I12
    Date: 2008
  4. By: Gustafsson, Björn (Göteborg University); Sai, Ding (Chinese Academy of Social Sciences)
    Abstract: Poverty among ethnic minorities and the majority in rural China for the years 2000, 2001 and 2002 is investigated taking a dynamic view and using a large sample covering 22 provinces. Based on the National Bureau of Statistics' low income line, almost one-third of the ethnic minorities experienced poverty during the three years studied while the corresponding proportion among the ethnic majority was only about half as high. Still, by far most of the poor in rural China belong to the ethnic majority. The relatively high poverty rates for ethnic minorities in rural China are found to be due to higher rates of entry than for the majority, while differences in exit rates across ethnicities are few. To a large extent, ethnic poverty differences can be attributed to differences in location together with temporary and persistent poverty in rural China having a very clear spatial character. Poverty is concentrated to the western region and villages with low average income. Determinants of persistent and temporary poverty in rural China differ due to location as well as household characteristics.
    Keywords: China, poverty, ethnic minorities
    JEL: I32 J15
    Date: 2008–10
  5. By: Peichl, Andreas (IZA); Schaefer, Thilo (University of Cologne); Scheicher, Christoph (University of Cologne)
    Abstract: In this paper, we define a new class of richness measures. In contrast to the often used headcount, these new measures are sensitive to changes in rich persons' income and therefore allow for a more sophisticated analysis of richness. We demonstrate the application of these new measures to analyze the development of poverty and richness over time in Germany, to compare Germany to many other European countries and to investigate the impact of tax reforms on poverty and richness. Using these examples, we show the importance of taking into account the intensity of changes and not only the number of people beyond a given richness line (headcount). We propose to use the new measures in addition to the headcount index for a more comprehensive analysis of richness.
    Keywords: richness, affluence, poverty, tax reform, flat tax
    JEL: D31 H23 I32
    Date: 2008–10
  6. By: Björklund, Anders (Stockholm University); Roine, Jesper (Stockholm School of Economics); Waldenström, Daniel (Research Institute of Industrial Economics (IFN))
    Abstract: This paper presents new evidence on intergenerational income and earnings mobility in the top of the distributions. Using a large dataset of matched father-son pairs in Sweden we are able to obtain results for fractions as small as 0.1 percent of the population. Overall, mobility is lower for incomes than for earnings and it appears to decrease the higher up in the distribution one goes. In the case of incomes, however, we find that mobility decreases dramatically within the top percentile of the population. Our results suggest that Sweden, well-known for its egalitarian achievements, is a society where equality of opportunity for a large majority of wage earners coexists with capitalistic dynasties.
    Keywords: Intergenerational income mobility; Top incomes; Earnings inequality; Income inequality; Welfare state; Non-linear regression; Quantile regression
    JEL: D31 J62
    Date: 2008–11–03

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