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on Unemployment, Inequality and Poverty |
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Issue of 2013‒05‒22
thirteen papers chosen by |
| By: | Luis F. Lopez-Calva; Sonia Rocha |
| Keywords: | Poverty Reduction - Poverty Impact Evaluation Social Protections and Labor - Labor Policies Poverty Reduction - Inequality Poverty Reduction - Rural Poverty Reduction Macroeconomics and Economic Growth - Income |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:12808&r=ltv |
| By: | Nattavudh Powdthavee (Centre for Economic Performance, London School of Economics: and Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Warn N. Lekfuangfu (University College London); Mark Wooden (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | Many economists and educators favour public support for education on the premise that education imporves the overall well-being of citizens. However, little is known about the casual pathwasy through which education shapes people's subjective well-being (SWB). This paper explores the direct and indirect well-being effects of extra schooling induced through compulsory schooling laws in Australia. We find the net effect of schooling on later SWB to be positive, though this effect is larger and statistically more robust for men than for women. We then show that the compulsory schooling effect on male's SWB is indirect and is mediated through income. |
| Keywords: | Schooling, indirect effect, well-being, mental health, windfall income, HILDA survey |
| JEL: | I20 I32 C36 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2013n16&r=ltv |
| By: | World Bank |
| Keywords: | Gender - Gender and Development Social Protections and Labor - Labor Markets Health, Nutrition and Population - Population Policies Social Protections and Labor - Labor Policies Education - Primary Education |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:12468&r=ltv |
| By: | World Bank |
| Keywords: | Social Protections and Labor - Labor Markets Health, Nutrition and Population - Population Policies Social Protections and Labor - Labor Policies Tertiary Education Access & Equity in Basic Education Education |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:11924&r=ltv |
| By: | Peter Edward (Newcastle University Business School); Andy Sumner (King's International Development Institute, King's College London) |
| Abstract: | Indonesia has achieved well-documented and drastic improvements in average incomes and in the reduction of poverty. Much research has discussed this progress. This paper adds to the literature with a new perspective. We discuss poverty in Indonesia using the international poverty lines ($1.25, $2 and we add $10/day). We generate historic estimates of poverty and make projections based on various growth and inequality trends. We find that Indonesia has the potential to attain high-income country status in a decade or so and at the same time, the potential to end $1.25/day and $2/day poverty but this would require favourable changes in distribution. Looking ahead, the end of poverty in Indonesia may be accompanied by a large proportion of the population vulnerable to poverty for some considerable time to come, suggesting public policy priorities may need to balance insurance and risk management mechanisms with more ‘traditional’ poverty policy. We also find, in contrast to national poverty line analysis, that poverty by the various international poverty lines, is considerably more urbanised, with more than half the poor residing in urban areas currently and the urban proportion of total poverty likely to rise further in the years ahead. |
| Keywords: | Indonesia, Poverty, Inequality |
| JEL: | I32 D63 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:unp:wpaper:201310&r=ltv |
| By: | Michael J. Boehm |
| Abstract: | Over the last two decades, earnings in the United States increased at the top and at the bottom of the wage distribution but not in the middle - the intensely debated middle class squeeze. At the same time there was a substantial decline of employment in middle-skill production and clerical occupations - so-called job polarization. I study whether job polarization has caused the middle class squeeze. So far little evidence exists about this because the endogenous selection of skills into occupations prevents credible identification of polarization's effect on wages. I solve the selection-bias problem by studying the changes in returns to occupation-specific skills instead of the changes in occupational wages using data over the two cohorts of the National Longitudinal Study of Youth (NLSY). This data features multidimensional and pre-determined test scores, which predict occupational sorting and thus measure relative occupation-specific skills. My estimation equations are derived from the Roy (1951) model over two cross-sections with job polarization amounting to a shift in the occupation-specific skill prices. In line with polarization, I find that a one percentage point higher propensity to enter high- (low-) as opposed to middle-skill occupations is associated with a .29 (.70) percent increase in expected wages over time. I then compute a counterfactual wage distribution using my estimates of the shifts in occupation-specific skill prices and show that it matches the increase at the top of the wage distribution but fails to explain the increase at the bottom. Thus, despite the strong association of job polarization with changes in the returns to occupation-specific skills, there remains room for alternative (e.g. policy related) explanations about the increase in the lower part of the wage distribution. |
| Keywords: | Job polarization, wage inequality, talent allocation, Roy model |
| JEL: | J21 J23 J24 J31 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1215&r=ltv |
| By: | Brant Abbott (University of British Columbia, Canada); Giovanni Gallipoli (University of British Columbia); Costas Meghir (Yale University and NBER, USA; IFS, UK); Giovanni L. Violante (New York University and NBER, USA; CEPR, UK) |
| Abstract: | This paper compares partial and general equilibrium effects of alternative financial aid policies intended to promote college participation. We build an overlapping generations life-cycle, heterogeneous-agent, incomplete-markets model with education, labor supply, and consumption/saving decisions. Altruistic parents make inter vivos transfers to their children. Labor supply during college, government grants and loans, as well as private loans, complement parental transfers as sources of funding for college education. We find that the current financial aid system in the U.S. improves welfare, and removing it would reduce GDP by two percentage points in the long-run. Any further relaxation of government-sponsored loan limits would have no salient effects. The short-run partial equilibrium effects of expanding tuition grants (especially their need-based component) are sizeable. However, long-run general equilibrium effects are 3-4 times smaller. Every additional dollar of government grants crowds out 20-30 cents of parental transfers. |
| Keywords: | Education, Financial Aid, Inter vivos Transfers, Credit Constraints, Equilibrium |
| JEL: | E24 I22 J23 J24 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:rim:rimwps:15_13&r=ltv |
| By: | World Bank |
| Keywords: | Early Child and Children's Health Health, Nutrition and Population - Population Policies Health, Nutrition and Population - Adolescent Health Health Monitoring and Evaluation Education - Primary Education |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:12260&r=ltv |
| By: | Elizabeth Ananat; Shihe Fu; Stephen L. Ross |
| Abstract: | We demonstrate a striking but previously unnoticed relationship between city size and the black-white wage gap, with the gap increasing by 2.5% for every million-person increase in urban population. We then look within cities and document that wages of blacks rise less with agglomeration in the workplace location, measured as employment density per square kilometer, than do white wages. This pattern holds even though our method allows for non-parametric controls for the effects of age, education, and other demographics on wages, for unobserved worker skill as proxied by residential location, and for the return to agglomeration to vary across those demographics, industry, occupation and metropolitan areas. We find that an individual’s wage return to employment density rises with the share of workers in their work location who are of their own race. We observe similar patterns for human capital externalities as measured by share workers with a college education. We also find parallel results for firm productivity by employment density and share college-educated using firm racial composition in a sample of manufacturing firms. These findings are consistent with the possibility that blacks, and black- majority firms, receive lower returns to agglomeration because such returns operate within race, and blacks have fewer same-race peers and fewer highly-educated same-race peers at work from whom to enjoy spillovers than do whites. Data on self-reported social networks in the General Social Survey provide further evidence consistent with this mechanism, showing that blacks feel less close to whites than do whites, even when they work exclusively with whites. We conclude that social distance between blacks and whites preventing shared benefits from agglomeration isa significant contributor to overall black-white wage disparities. |
| Keywords: | Black White Wage Gap, Agglomeration Economies, Human Capital Externalities,Information Networks, Total Factor Productivity |
| JEL: | J15 J24 J31 R23 R32 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:13-24&r=ltv |
| By: | World Bank |
| Keywords: | Social Protections and Labor - Safety Nets and Transfers Health, Nutrition and Population - Population Policies Poverty Reduction - Rural Poverty Reduction Macroeconomics and Economic Growth - Regional Economic Development |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:12321&r=ltv |
| By: | D. Del Boca; C. Monfardini; C. Nicoletti |
| Abstract: | While a large literature has focused on the impact of parental investments on child cognitive development, very little is known about the role of child's own in- vestments. Information on how children invest their time separately from parents is probably little informative for babies and toddlers, but it becomes more and more important in later stages of life, such as adolescence, when children start to take decisions independently. By using the Child Development Supplement of the PSID (Panel Study of Income Dynamics), we model the production of cognitive ability of adolescents and extend the set of inputs to include the child's own time investments. Looking at investments during adolescence, we find that child's investments matter more than mother's investments. On the contrary, looking at investments during childhood, it is the mother's investments that are more important. Our results are obtained accounting for potential unobserved child's and family's endowments and are robust across several specifications and samples, e.g. considering and not considering father's investments and non-intact families. |
| Keywords: | time-use, cognitive ability, child development, adolescence |
| JEL: | J13 D1 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wchild:5&r=ltv |
| By: | Christopher A. Pissarides |
| Abstract: | This paper studies the responses of unemployment in Germany, the United States and Britain to the Great Recession of 2008-09 by making use of Beveridge curve analysis, and in the entire OECD with other techniques. It is shown that Britain suffered from recession but no structural problems; the United States suffered from structural unemployment during the recovery; Germany exhibited a much better performance both during and after the recession. The rise in OECD unemployment is broken down into parts due to aggregate activity, the construction sector and a residual attributed to policies and institutions, which is used to reach conclusions about policy. |
| Keywords: | Unemployment, Great Recession, vacancies, Beveridge curve, construction sector, policies and institutions |
| JEL: | E24 J6 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1210&r=ltv |
| By: | Brendan Markey-Towler (School of Economics, The University of Queensland); John Foster (School of Economics, The University of Queensland) |
| Abstract: | We suggest in this paper that inequality in economic systems can be profitably analysed using complex systems analysis. We explain how we can capture, analytically, complexity in an economic system by applying graph theory in networks. We then develop a highly stylised theoretical model of how income inequality arises naturally due to the fact that a skewed income distribution necessarily arises from “preferential attachment†in a complex economic system. We characterise this process, both in the market system broadly defined and, specifically, within a firm. It is argued that such a complex systems approach (despite being vastly simplified here) provides a superior basis for understanding income inequality compared to standard economic analysis. |
| Date: | 2013–05–10 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:478&r=ltv |