nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2013‒06‒30
nine papers chosen by
Maximo Rossi
University of the Republic

  1. Polarization of time and income – A multidimensional approach with well-being gap and minimum 2DGAP: German evidence By Joachim Merz; Bettina Scherg
  2. Do labor market networks have an important spatial dimension? By Judith K. Hellerstein; Mark J. Kutzbach; David Neumark
  3. The Future of Global Poverty in a Multi-Speed World: New Estimates of Scale and Location, 2010–2030 By Peter Edward; Andy Sumner
  4. Gender Differences in Earnings and Labor Supply in Early Career: Evidence from Kosovo's School-to-Work Transition Survey By Pastore, Francesco; Sattar, Sarosh; Tiongson, Erwin R.
  5. Human capital, social mobility and the skill premium By Konstantinos Angelopoulos; James Malley; Apostolis Philippopoulos
  6. The Employment of the Low-Skilled Youth in France By Cahuc, Pierre; Carcillo, Stéphane; Zimmermann, Klaus F.
  7. Circumstances and Efforts: How important is their correlation for the measurement of inequality of opportunity in health?. By Trannoy, Alain; Tubeuf, Sandy; Jusot, Florence
  8. Job Promotion in Mid-Career: Gender, Recession and ‘Crowding’ By John T. Addison; Orgul D.Ozturk; Si Wang
  9. Life Quantity, Life Quality and Longevity : an Intertemporal Social Evaluation framework By Jean-Yves Duclos; Bouba Housseini

  1. By: Joachim Merz (LEUPHANA University Lüneburg); Bettina Scherg (LEUPHANA University Lüneburg)
    Abstract: A growing polarization of society accompanied with an erosion of the middle class experiences more and more attention at least in the German recent economic and social policy discussion. Our study contributes to the polarization discussion with respect to multidimensional theoretical measurement and empirical application in two ways: First, we propose extended multidimensional polarization indices based on a CES-type well-being function and present a new measure to multidimensional polarization, the mean minimum polarization gap 2DGAP. This polarization intensity measure provides transparency with regard to each singular attributes – important for targeted policies – and ensures at the same time its interdependent relations. Second, the empirical application – in addition to the traditional income measure –incorporates time as a fundamental resource for any activity. In particular, genuine personal leisure time will take care of social participation in the spirit of social inclusion/exclusion and Amartya Sen’s capability approach. Instead of arbitrarily choosing the attributes’ parameters in the CES well-being function the interdependent relations of time and income will be evaluated by German Society. With the German Socio-Economic Panel (SOEP) and detailed time use diary data of the available German Time Use Survey (GTUS) 1991/92 and 2001/02 we quantify available and extended multidimensional polarization measures as well as our new approach for the polarization development of the working poor and the working rich in Germany. Results: Genuine personal leisure time in addition to income is an important polarization attribute. Compensation is of economic and static significance. In particular supported by the new minimum 2DGAP approach, multidimensional polarization increased over that decade in Germany.
    Keywords: Multidimensional polarization, intensity of time and income poverty and affluence, interdependent multidimensional time and income poverty and affluence, minimum multidimensional polarization gap (2DGAP), extended economic well-being, satisfaction/happiness, working poor, CES well-being function, German Socio-Economic Panel, German Time Use Surveys 1991/92 and 2001/02.
    JEL: I32 D31 J22
    Date: 2013–05
    URL: http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2013-297&r=ltv
  2. By: Judith K. Hellerstein (University of Maryland & NBER); Mark J. Kutzbach (U.S. Bureau of the Census); David Neumark (UCI, NBER & IZA)
    Abstract: We test for evidence of spatial, residence-based labor market networks. Turnover is lower for workers more connected to their neighbors generally and more connected to neighbors of the same race or ethnic group. Both results are consistent with networks producing better job matches, while the latter could also reflect preferences for working with neighbors of the same race or ethnicity. For earnings, we find a robust positive effect of the overall residence-based network measure, whereas we usually find a negative effect of the same-group measure, suggesting that the overall network measure reflects productivity-enhancing positive network effects, while the same-group measure may capture a non-wage amenity.
    Keywords: Networks, job matches, wages, turnover
    JEL: J15 J30 J63
    Date: 2013
    URL: http://d.repec.org/n?u=RePEc:ieb:wpaper:2013/6/doc2013-20&r=ltv
  3. By: Peter Edward; Andy Sumner
    Abstract: Smart decisions about where to focus poverty alleviation projects depend on accurate projections of where the bulk of the world’s poor will be living in 10, 20 years or more. So far, though, the picture has been murky. Data limitations and an abundance of modeling strategies complicate forecasts and contribute to wide discrepancies. In this working paper, Peter Edward and Andy Sumner introduce new model of growth, inequality, and poverty that allows comparison of a wide range of input assumptions. They find that it is plausible that $1.25 and $2 global poverty will reduce substantially by 2030 and the former – $1.25 poverty – could be very low by that time. However, this depends a lot on economic growth and inequality trends—up to almost an extra billion $2 poor people in one scenario. Where the world’s poor will reside also depends on inequality trends and the methods used to estimate poverty. The authors find little compelling evidence that global poverty will be based in low-income fragile state, and they suggest policymakers take into account the greater variety of country categories that will be home to the future of global poverty.
    Keywords: poverty, inequality, projections, methodology
    JEL: I32 D63
    Date: 2013–06
    URL: http://d.repec.org/n?u=RePEc:cgd:wpaper:327&r=ltv
  4. By: Pastore, Francesco (University of Naples II); Sattar, Sarosh (World Bank); Tiongson, Erwin R. (World Bank)
    Abstract: Very little is known about gender wage disparities in Kosovo and, to date, nothing is known about how such wage disparities evolve over time, particularly during the first few years spent by young workers in the labor market. More generally, not much is known about gender wage gaps in early career worldwide, a period which is perceived to be an important determinant of the overall gender wage disparity. This paper analyzes data from the School-to-Work Transition (SWT) survey, an unusual survey conducted by the ILO between 2004 and 2006 in eight countries, including Kosovo, that documents the labor market experiences of the youngest age segment in the labor force (age 15–25 years). The results of the analysis suggest that, on average, women have lower education attainment than men but this educational disparity is masked among the sample of employed men and women who tend to be well-educated. The consequences of this dramatic segmentation of labor market participation are striking. On average, there is little or no gender wage gap. The results of the Juhn et al. (1993) decomposition analysis reveals that gender wage differences are almost entirely driven by differences in characteristics (rather than either the returns to those characteristics or the residual). The greater average educational attainment of employed women, among other characteristics, tends to fully offset the gender wage gap. Not surprisingly, the returns to women's education among employed women are low because there is little variation in educational attainment among the sample of well-educated employed women. When the analysis controls for sample selection bias and heterogeneity, the returns to women's education rise, confirming the lower productivity-related characteristics of non-employed women compared to employed women. The relatively small sample constrains a fuller analysis of the emergence of the gender wage gap, which, according to a small but growing international literature, typically materializes during childbearing years.
    Keywords: gender wage gap and dynamics, early labor market outcomes, school-to-work transitions, earnings equations, decomposition analysis, Balkans area, Kosovo
    JEL: I21 J13 J15 J16 J24 J31 J7 P30
    Date: 2013–06
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp7461&r=ltv
  5. By: Konstantinos Angelopoulos; James Malley; Apostolis Philippopoulos
    Abstract: This paper considers the role of human capital accumulation of agents differentiated by skill type in the joint determination of social mobility and the skill premium. Our approach allows us to evaluate the dynamic e¤ects of tax reforms and education spending policies on economic e¢ ciency as well as on social and wage inequality. The analysis contributes to the literature by showing that endogenous so- cial mobility, human capital for skilled and unskilled labour, and exter- nalities from skilled human capital on social mobility are key channels through which tax-spending policy is transmitted.
    Keywords: social mobility, skill premium, tax and education policy
    JEL: E62 J31 J62
    Date: 2013–06
    URL: http://d.repec.org/n?u=RePEc:gla:glaewp:2013_10&r=ltv
  6. By: Cahuc, Pierre (Ecole Polytechnique, Paris); Carcillo, Stéphane (OECD); Zimmermann, Klaus F. (IZA and University of Bonn)
    Abstract: Youth unemployment is notoriously high in France, in particular for the low-skilled. Within the EU, only the crisis countries of Southern Europe fare worse. This report delivered to the French Council of Economic Analysis analyzes the causes and consequences of this alarming trend. In addition, drawing on the available evidence on various measures that could improve the current situation, concrete policies proposals are derived that cover the areas of vocational education, second chance programs, job search assistance, income support, employment subsidies and dismissal protection.
    Keywords: labor policy, youth unemployment, minimum wage, vocational education, employment protection, France
    JEL: J24 J38 J68
    Date: 2013–06
    URL: http://d.repec.org/n?u=RePEc:iza:izapps:pp64&r=ltv
  7. By: Trannoy, Alain; Tubeuf, Sandy; Jusot, Florence
    Abstract: The way to treat the correlation between circumstances and effort is a central, yet largely neglected issue in the applied literature on inequality of opportunity. This paper adopts three alternative normative ways of treating this correlation championed by Roemer, Barry and Swift and assesses their empirical relevance using survey data. We combine regression analysis with the natural decomposition of the variance to compare the relative contributions of circumstances and efforts to overall health inequality according to the different normative principles. Our results suggest that, in practice, the normative principle on the way to treat the correlation between circumstances and effort makes little difference on the relative contributions of circumstances and efforts to explained health inequality.
    Keywords: equality of opportunity; variance decomposition; circumstances; effort; health; inequality decomposition;
    JEL: I12 D63
    Date: 2013
    URL: http://d.repec.org/n?u=RePEc:ner:dauphi:urn:hdl:123456789/5065&r=ltv
  8. By: John T. Addison (Department of Economics, Moore School of Business, University of South Carolina, and GEMF / University of Coimbra, Portugal); Orgul D.Ozturk (Department of Economics, Moore School of Business, University of South Carolina); Si Wang (Department of Economics, Moore School of Business, University of South Carolina)
    Abstract: Data from the National Longitudinal Survey of Youth 1979 indicate that between 1996 and 2010 females on average lost some of the promotion momentum they had achieved at the beginning of mid-career, although they outperformed males in this regard. For both genders economic downturn has contributed to reduced promotion probabilities. In the case of women, however, cohort effects rather than the cycle seem to explain the promotion experience during the Great Recession. Promotions translate into higher real wage increases, and typically more so where job responsibilities increase. Crowding effects, if not necessarily a thing of the past, are no longer manifested in reduced female promotion rates or earnings.
    Date: 2013–06
    URL: http://d.repec.org/n?u=RePEc:gmf:wpaper:2013-16.&r=ltv
  9. By: Jean-Yves Duclos; Bouba Housseini
    Abstract: The evaluation of development processes and of public policies often involves comparisons of social states in which populations differ in size and longevity. This requires social evaluation principles to be sensitive to both the number and the length of lives. This paper explores the use of axiomatic and welfarist principles to assess social welfare in that framework. It attempts to overcome some of the limits of existing methods in the literature, in particular by avoiding a temporal repugnant conclusion, by neither penalizing nor favoring life fragmentation, and by satisfying critical-level temporal consistency. It does this by characterizing a critical-level lifetime utility function that values life periodically. To address some of the controversies on discounting utilities across time, two alternative versions of the function are developed, one with discounting and one without.
    Keywords: Intertemporal social evaluation, population ethics, critical-level utilitarianism, lifetime utility, social discounting
    JEL: C02 D31 D63 I31 J17
    Date: 2013
    URL: http://d.repec.org/n?u=RePEc:lvl:lacicr:1315&r=ltv

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