nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2013‒01‒12
eight papers chosen by
Maximo Rossi
University of the Republic

  1. Lifetime Earnings Inequality in Germany By Lüthen, Holger; Bönke, Timm; Corneo, Giacomo
  2. Inequality of opportunity, income inequality and economic mobility : some international comparisons By Brunori, Paolo; Ferreira, Francisco H. G.; Peragine, Vito
  3. The Developmental Approach to Child and Adult Health By Gabriella Conti; James J. Heckman
  4. Remittances and Gender-Speci fic Employment Patterns in Peru - a longitudinal Analysis By Göbel, Kristin
  5. Measuring Vulnerability to Poverty Using Long-Term Panel Data By Landau, Katja; Klasen, Stephan; Zucchini, Walter
  6. The gender income gap and the influence of family formation reconsidered By Ochsenfeld, Fabian
  7. General Education, Vocational Education, and Labor-Market Outcomes over the Life-Cycle By Wößmann, Ludger; Hanushek, Eric A.; Zhang, Lei
  8. Do literacy and numeracy pay off? On the relationship between basic skills and earnings By Antoni, Manfred; Heineck, Guido

  1. By: Lüthen, Holger; Bönke, Timm; Corneo, Giacomo
    Abstract: This paper documents the magnitude, pattern, and evolution of lifetime earnings inequality in Germany. Based on a large sample of earning biographies from social security records, we show that the intra-generational distribution of lifetime earnings of male workers has a Gini coefficient around .2 for cohorts born in the late 1930s and early 1940s; this amounts to about 2/3 of the value of the Gini coefficient of annual earnings. Within cohorts, mobility in the distribution of yearly earnings is substantial at the beginning of the lifecycle, decreases afterwards and virtually vanishes after age forty. Earnings data for thirty-one cohorts reveals striking evidence of a secular rise of intra-generational inequality in lifetime earnings: West-German men born in the early 1960s are likely to experience about 80 % more lifetime inequality than their fathers. In contrast, both short-term and long-term intra-generational mobility have been rather stable. Longer unemployment spells of workers at the bottom of the distribution of younger cohorts contribute to explain 30 to 40 % of the overall increase in lifetime earnings inequality. --
    JEL: D31 D33 H24
    Date: 2012
  2. By: Brunori, Paolo; Ferreira, Francisco H. G.; Peragine, Vito
    Abstract: Despite a recent surge in the number of studies attempting to measure inequality of opportunity in various countries, methodological differences have so far prevented meaningful international comparisons. This paper presents a comparison of ex-ante measures of inequality of economic opportunity (IEO) across 41 countries, and of the Human Opportunity Index (HOI) for 39 countries. It also examines international correlations between these indices and output per capita, income inequality, and intergenerational mobility. The analysis finds evidence of a"Kuznets curve"for inequality of opportunity, and finds that the IEO index is positively correlated with overall income inequality, and negatively with measures of intergenerational mobility, both in incomes and in years of schooling. The HOI is highly correlated with the Human Development Index, and its internal measure of inequality of opportunity yields very different country rankings from the IEO measure.
    Keywords: Inequality,Equity and Development,Poverty Impact Evaluation,Services&Transfers to Poor,Economic Theory&Research
    Date: 2013–01–01
  3. By: Gabriella Conti; James J. Heckman
    Abstract: Pediatricians should consider the costs and benefits of preventing rather than treating childhood diseases. We present an integrated developmental approach to child and adult health that considers the costs and benefits of interventions over the life cycle. We suggest policies to promote child health which are currently outside the boundaries of conventional pediatrics. We discuss current challenges to the field and suggest avenues for future research.
    JEL: I12 I18
    Date: 2012–12
  4. By: Göbel, Kristin
    Abstract: This study examines the role of migrant's remittances on labor supply in remittance receiving households. A simple labor choice model is developed which is extended to include self-employment. Unlike earlier studies, fixed effects estimations as well as an instrumental approach are applied. Estimates are provided for both participation and hours. Strong evidence is provided that remittances increase self-employment at the extensive margin for women. Overall, no robust effect of reduced labor supply in response to remittances is found. --
    JEL: O15 J22 F24
    Date: 2012
  5. By: Landau, Katja; Klasen, Stephan; Zucchini, Walter
    Abstract: We investigate the accuracy of ex ante assessments of vulnerability to poverty using cross-sectional data and panel data. We use long-term panel data from Germany and apply different regression models, based on household covariates and previous-year equivalence income, to classify a household as vulnerable or not. Predictive performance is assessed using the Receiver Operating Characteristics (ROC), which takes account of false positive as well as true positive rates. Estimates based on cross-sectional data are much less accurate than those based on panel data, but for Germany, the accuracy of vulnerability predictions is limited even when panel data are used. In part this low accuracy is due to low poverty incidence and high mobility. --
    JEL: C23 C52 I32
    Date: 2012
  6. By: Ochsenfeld, Fabian
    Abstract: In her recent study Bobbitt-Zeher (2007) takes on the important task of identifying the contribution of educational factors relative to non-educational factors in the making of the gender income gap among the college-educated and finds that “family formation has virtually no effect on the income gap” (Ibid.:13). In this methodological comment we argue that she was led to this conclusion prematurely because her analysis falls short in several respects. We explicate the problems, delineate alternatives and replicate her analysis with similar German data. We find that each of the shortcomings leads to negative bias concerning the influence of family formation. Our results show that family formation is likely to be the single most important factor in the explanation of the income gap.
    Keywords: gender inequality; motherhood penalty; discrimination; regression analysis; decomposition
    JEL: C50 J70 J16
    Date: 2012–06–26
  7. By: Wößmann, Ludger; Hanushek, Eric A.; Zhang, Lei
    Abstract: Policy debates about the balance of vocational and general education programs focus on the school-to-work transition. But with rapid technological change, gains in youth employment from vocational education may be offset by less adaptability and thus diminished employment later in life. To test our main hypothesis that any relative labor-market advantage of vocational education decreases with age, we employ a difference-in-differences approach that compares employment rates across different ages for people with general and vocational education. Using micro data for 18 countries from the International Adult Literacy Survey, we find strong support for the existence of such a trade-off, which is most pronounced in countries emphasizing apprenticeship programs. Results are robust to accounting for ability patterns and to propensity-score matching. --
    JEL: J24 I20 J64
    Date: 2012
  8. By: Antoni, Manfred; Heineck, Guido
    Abstract: What is the value of basic skills in the German labor market which until recently was considered to be strongly regulated but has gained flexibility in the last 15 years? To answer this question, we examine the relationship between adults' literacy, numeracy and earnings. We use data from the ALWA-ADIAB database, which is a test augmented survey linked to administrative data, making information on both skills and earnings most accurate. Preliminary results indicate that earnings are positively related to both types of skills. This relationship is more pronounced for numeracy than for literacy. Heterogenous results are found when running separate regressions for sub-groups, for instance by sex. --
    JEL: I21 J31 C83
    Date: 2012

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