nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2014‒01‒10
four papers chosen by
Maximo Rossi
University of the Republic

  1. Opportunity-sensitive poverty measurement By Paolo Brunori; Francisco Ferreira; Maria Ana Lugo; Vito Peragine
  2. Social mobility at the top: Why are elites self-reproducing? By Elise S. Brezis; Joel Hellier
  3. Understanding the Russian malaise: The collapse and recovery of subjective well-being in post-communist Russia By Ronald Inglehart; Roberto Foa; Eduard Ponarin; Christian Welzel
  4. Returns to Skills Around the World: Evidence from PIAAC By Eric A Hanushek; Guido Schwerdt; Simon Wiederhold; Ludger Woessmann

  1. By: Paolo Brunori (University of Bari); Francisco Ferreira (World Bank and IZA); Maria Ana Lugo (World Bank); Vito Peragine (University of Bari)
    Abstract: We axiomatically characterize two classes of poverty measures which are sensitive to inequality of opportunity - one a strict subset of the other. The proposed indices are sensitive not only to income shortfalls from the poverty line, but also to differences in opportunities faced by people with different pre-determined characteristics, such as race or family background. Dominance conditions are established for each class of measures, and a sub-family of scalar indices, based on a rank-dependent aggregation of type-specific poverty levels, is also introduced. Using household survey data from eighteen European countries in 2005, we find substantial differences in country rankings based on standard FGT indices and on the new opportunity-sensitive indices. Cross-country differences in opportunity-sensitive poverty are decomposed into a level effect; a distribution effect; and a population composition effect.
    Keywords: Inequality of opportunity, poverty measures, poverty comparisons.
    JEL: D31 D63 J62
    Date: 2013–11
    URL: http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2013-317&r=ltv
  2. By: Elise S. Brezis (Azrieli Center for Economic Policy (ACEP), Bar-Ilan University, Israel); Joel Hellier (Department of Economics, EQUIPPE, Univ. de Lille and LEMNA, Univ. de Nantes, France)
    Abstract: This paper proposes an explanation for the decrease in social mobility that has occurred in the last two decades in a number of advanced economies, as well as for the divergence in mobility dynamics across countries. Within an intergenerational framework, we show that a two-tier higher education system with standard and elite universities generates social stratification, high social immobility and self-reproduction of the elite. Moreover, we show that the higher the relative funding for elite universities, the higher the elite self-reproduction, and the lower social mobility. We also analyse the impacts of changes in the weight of the elite and of the middle class upon social mobility. Our findings provide theoretical bases for the inverted-U profile of social mobility experienced in several countries since World War II and to the ``Great Gatsby Curve'' relating social mobility to inequality.
    Keywords: Elite, higher education, selection, social mobility, social stratification.
    JEL: I21 J62 O15 Z13
    Date: 2013–11
    URL: http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2013-312&r=ltv
  3. By: Ronald Inglehart (Higher School of Economics); Roberto Foa (Harvard University); Eduard Ponarin (Higher School of Economics); Christian Welzel (Center for the Study of Democracy, Leuphana University, Scharnhorststr.)
    Abstract: This article analyzes the decline of subjective well-being and a sense of national self-esteem among the Russian people that was linked with the collapse of the communist economic, political and social systems in the 1990s—and a subsequent recovery of subjective well-being that began more recently. Subjective well-being is closely linked with economic development, democracy and physical health. The people of rich countries tend show higher levels than those of poor countries, but already in 1982, the Russia people ranked lower on happiness and life satisfaction than the people of much poorer countries such as Nigeria or India; external signs of this malaise were rising alcoholism and declining male life expectancy. But after the collapse of the Soviet Union, subjective well-being in Russia fell to levels never seen before, reaching a low point in 1995 when most Russians described themselves as unhappy and dissatisfied with their lives as a whole. Since 2000, this trend has been reversing itself, but in 2011 Russia still ranked slightly lower than its level in 1981
    Keywords: World Values Survey, Russia, happiness, subjective well-being
    JEL: E11
    Date: 2013
    URL: http://d.repec.org/n?u=RePEc:hig:wpaper:32/soc/2013&r=ltv
  4. By: Eric A Hanushek; Guido Schwerdt; Simon Wiederhold; Ludger Woessmann
    Abstract: Existing estimates of the labor-market returns to human capital give a distorted picture of the role of skills across different economies. International comparisons of earnings analyses rely almost exclusively on school attainment measures of human capital, and evidence incorporating direct measures of cognitive skills is mostly restricted to early-career workers in the United States. Analysis of the new PIAAC survey of adult skills over the full lifecycle in 22 countries shows that the focus on early-career earnings leads to underestimating the lifetime returns to skills by about one quarter. On average, a one-standard-deviation increase in numeracy skills is associated with an 18 percent wage increase among prime-age workers. But this masks considerable heterogeneity across countries. Eight countries, including all Nordic countries, have returns between 12 and 15 percent, while six are above 21 percent with the largest return being 28 percent in the United States. Estimates are remarkably robust to different earnings and skill measures, additional controls, and various subgroups. Intriguingly, returns to skills are systematically lower in countries with higher union density, stricter employment protection, and larger public-sector shares. Les estimations actuelles des rendements du marché du travail sur le capital humain donnent une image déformée du rôle des compétences dans les différentes économies. Les comparaisons internationales des analyses des revenus du travail dépendent presque exclusivement des mesures de réussite scolaire du capital humain, et les données intégrant des mesures directes des capacités cognitives se limitent essentiellement aux travailleurs en début de carrière aux États-Unis. Les analyses de la nouvelle évaluation des compétences des adultes sur le cycle de vie complet dans 22 pays (PIAAC) montrent que mettre l'accent sur les gains en début de carrière conduit à sous-estimer la durée de vie du rendement des compétences d'environ un quart. En moyenne, une augmentation d'un écart-type en capacités de calcul est associée à une augmentation de salaire de 18 pour cent chez les travailleurs les plus jeunes. Mais ceci masque une grande hétérogénéité entre les pays. Huit pays, dont les pays nordiques, ont des rendements entre 12 et 15 pour cent, tandis que six sont au-dessus de 21 pour cent, le plus grand rendement étant de 28 pour cent aux États-Unis. Les estimations sont remarquablement robustes aux différents résultats et mesures des compétences, aux contrôles supplémentaires, et aux divers sous-groupes. Curieusement, le rendement des compétences est systématiquement plus faible dans les pays à forte densité syndicale, où la protection de l'emploi est plus stricte et la part du secteur public plus grande.
    Keywords: labour markets, cognitive skills, education, international comparisons
    JEL: F31 I20
    Date: 2013–12–17
    URL: http://d.repec.org/n?u=RePEc:oec:eduaab:101-en&r=ltv

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