nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2010‒08‒14
eight papers chosen by
Maximo Rossi
University of the Republic

  1. Success and Failure in Human Development, 1970-2007 By Gustav Ranis; Frances Stewart
  2. Advances in sub national measurement of the Human Development Index: The case of Mexico By Rodolfo de la Torre; Hector Moreno
  3. The Challenges of Incorporating Empowerment into the HDI: Some Lessons from Happiness Economics and Quality of Life Research By Carol Graham
  4. Poverty and Time By Bossert, Walter; Chakravarty, Satya R.; d’Ambrosio, Conchita
  5. Measuring the Effect of Spell Recurrence on Poverty Dynamics By Arranz, José Maria; Cantó, Olga
  6. Conditional Cooperation: Evidence for the Role of Self-Control By Martinsson, Peter; Myrseth, Kristian Ove R.; Wollbrant, Conny
  7. Analyzing social experiments as implemented: evidence from the HighScope Perry Preschool Program By James Heckman; Seong Hyeok Moon; Rodrigo Pinto; Peter Savelyev; Adam Yavitz
  8. The Trend of BMI Values of US Adults by Centiles, birth cohorts 1882-1986 By John Komlos; Marek Brabec

  1. By: Gustav Ranis (Yale University); Frances Stewart (Centre for Research on Inequality, Human Security and Ethnicity, University of Oxford)
    Abstract: The paper reviews experience in advancing Human Development since 1970 by investigating behaviour among countries that made the largest improvements in HD, and those that made the least improvement. The three developing countries with the fastest growth in the HDI over the period are selected from initial low-HDI, middle HDI- and high HDI country groupings, and their experience compared on a range of indicators. Certain characteristics were common to all success cases: good or moderate educational enrolment ratios; good or moderate female/male enrolment ratios; and good or moderate Human Poverty Indices. The other three major inputs into success appear to be growth, social expenditure and income distribution, and the successful countries showed different combinations of performance on these. Weak performers all experienced poor or moderate economic growth. Two classes of weak performance were: low income countries with weak growth, poor distribution and high poverty; and transition countries where economic, institutional and demographic disruptions led to poor progress. We also look beyond the HDI as an indicator of HD, explore such other features as political freedoms, security and environmental sustainability, and find little correlation between achievements on these indicators (both in levels and changes) with success and failure with respect to the HDI. Finally we provide short country vignettes of some of the success and failure cases, exploring some historical and institutional features associated with their performance.
    Keywords: Human Development, growth, income distribution
    JEL: O11 O2 O20 O15
    Date: 2010–07
  2. By: Rodolfo de la Torre (Human Development Research Office (HDRO), PNUD Mexico and Centro de Investigación y Docencia Económicas (CIDE)); Hector Moreno (Human Development Research Office (HDRO), PNUD Mexico)
    Abstract: This paper surveys the main informational, conceptual and theoretical adjustments made to the HDI in the Mexican Human Development Reports and presents a way in which the calculation of the HDI could be carried out to the individual level. First, informational changes include redistributing government oil revenues from oil producing regions to the rest of the country in order to obtain a better picture of available resources and imputing per capita average household income to all municipalities combining census and income surveys. Also, state information is used to set counterfactuals about the first effects of internal migration on development, and municipal data is applied to decompose inequality indices to identify the sources and regions contributing to overall human development inequality. Second, conceptual adjustments consider introducing two additional dimensions to the HDI: being free from local crime and the absence of violence against women. Third, a key theoretical contribution from the Mexican National Reports to the HDI literature is the proposal of an inequality sensitive development index based on the concept of generalized means. Finally, the proposed disaggregation of the HDI at the household and individual level allows analyzing development levels for subgroups of population either by age, ethnic condition, sex and income or HDI deciles across time.
    Keywords: Human Development Index, individual HDI, household HDI, inequality, migration, local crime, absence of violence against women, generalized means
    JEL: C81 I3 D63
    Date: 2010–07
  3. By: Carol Graham (Brookings Institution and University of Maryland)
    Abstract: The introduction of the HDI sparked a major debate about the adequacy of income as a measure of development. Perhaps as a result, scholars have developed a number of novel measures of well being. Prominent among these is the use of happiness surveys to study well being in its various dimensions, ranging from well being within persons, to the determinants of well being across individuals, to the effects of contextual factors, such as the environment, political regime, and macroeconomic conditions. Sen’s capabilities approach to poverty, which underlies the HDI, highlights the lack of capacity of the poor to make choices or to take certain actions. Happiness surveys are a means to assess the well being of individuals who are constrained in their capacity to make choices or reveal preferences. This paper reviews what we know about measuring quality of life, based on extensive work with happiness surveys in Latin America, and how that accumulated knowledge can inform the debate the HDI originally sparked. It also discusses how the surveys can contribute to our understanding and measurement of empowerment. It discusses the promises – and potential pitfalls – of directly applying the findings to policy, challenges which are germane to measuring and comparing empowerment across countries.
    Keywords: empowerment, poverty, happiness, policy
    JEL: D63 I32 J17 J18 Z0
    Date: 2010–07
  4. By: Bossert, Walter; Chakravarty, Satya R.; d’Ambrosio, Conchita
    Abstract: We examine the measurement of individual poverty in an intertemporal context. Our aim is to capture the importance of persistence in a state of poverty and we characterize a corresponding individual intertemporal poverty measure. Our first axiom requires that intertemporal poverty is identical to static poverty in the degenerate single-period case. The remaining two properties express decomposability requirements within poverty spells and across spells in order to reflect the persistence issue. In addition, we axiomatize an aggregation procedure to obtain an intertemporal poverty measure for societies and we illustrate our new index with an application to EU countries.
    Keywords: Intertemporal poverty measurement, equity
    Date: 2010
  5. By: Arranz, José Maria; Cantó, Olga
    Abstract: The analysis of poverty dynamics yields important insights about the expected effectiveness of alternative social policies on poverty reduction. This paper analyses the effect of spell recurrence on poverty dynamics taking into account multiple poverty and non-poverty spells. Using longitudinal data for Spain we obtain that the poverty exit and re-entry rates vary not only with personal or household characteristics but also with spell accumulation and with the duration of past spells. Results indicate that the effect of duration dependence is significant and turns out to be different by spell order. Our findings support progress towards incorporating full individual poverty trajectories more explicitly in estimating the likelihood of future poverty.
    Keywords: poverty dynamics, multiple spells, recurrence
    Date: 2010
  6. By: Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University); Myrseth, Kristian Ove R. (ESMT European School of Management and Technology, Berlin, Germany); Wollbrant, Conny (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: When facing the opportunity to allocate resources between oneself and others, individuals may experience a self-control conflict between urges to act selfishly and preferences to act pro-socially. We explore the domain of conditional cooperation, and we test the hypothesis that increased expectations about others’ average contribution increases own contributions to public goods more when self-control is high than when it is low. We pair a subtle framing technique with a public goods experiment. Consistent with our hypothesis, we find that conditionally cooperative behavior is stronger (i.e., less imperfect) when expectations of high contributions are accompanied by high levels of self-control.<p>
    Keywords: Self-control; Pro-social behavior; Public good experiment; Conditional cooperation
    JEL: D01 D64 D70
    Date: 2010–08–05
  7. By: James Heckman (Institute for Fiscal Studies and University of Chicago); Seong Hyeok Moon; Rodrigo Pinto; Peter Savelyev; Adam Yavitz
    Abstract: <p><p><p><p>Social experiments are powerful sources of information about the effectiveness of interventions. In practice, initial randomization plans are almost always compromised. Multiple hypotheses are frequently tested. "Significant" effects are often reported with p-values that do not account for preliminary screening from a large candidate pool of possible effects. This paper develops tools for analyzing data from experiments as they are actually implemented.</p> </p><p></p><p></p><p><p>We apply these tools to analyze the influential HighScope Perry Preschool Program. The Perry program was a social experiment that provided preschool education and home visits to disadvantaged children during their preschool years. It was evaluated by the method of random assignment. Both treatments and controls have been followed from age 3 through age 40.</p> </p><p></p><p></p><p><p>Previous analyses of the Perry data assume that the planned randomization protocol was implemented. In fact, as in many social experiments, the intended randomization protocol was compromised. Accounting for compromised randomization, multiple-hypothesis testing, and small sample sizes, we find statistically significant and economically important program effects for both males and females. We also examine the representativeness of the Perry study.</p><p><a href="/wps/cwp2210_app.pdf">Download appendix</a></p></p>
    Date: 2010–08
  8. By: John Komlos; Marek Brabec
    Abstract: Trends in BMI values are estimated by centiles of the US adult population by birth cohorts 1886-1986 stratified by ethnicity. The highest centile increased by some 18 to 22 units in the course of the century while the lowest ones increased by merely 1 to 3 units. Hence, the BMI distribution became increasingly right skewed as the distance between the centiles became increasingly larger. The rate of change of BMI centile curves varied considerably over time. The BMI of white men and women experienced upsurges after the two World Wars and downswings during the Great Depression and again after 1970. However, among blacks the pattern is different during the first half of the century with men's rate of increase in BMI values decreasing substantially and that of females remaining unchanged at a relatively high level until the Second World War. However, after the war the rate of change of BMI values of blacks resembled that of the whites with an accelerating phase followed by a slow down around the 1970s. In sum, the creeping nature of the obesity epidemic is evident, as the technological and lifestyle changes of the 20th century affected various segments of the population quite differently.
    JEL: I10
    Date: 2010–08

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