nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2016‒07‒23
five papers chosen by
Maximo Rossi
Universidad de la República

  1. The challenge of measuring UK wealth inequality in the 2000s By Facundo Alvaredo; Anthony B. Atkinson; Salvatore Morelli
  2. Income Poverty, Affluence and Polarisation Viewed From The Median By Rolf Aaberge; A.B. Atkinson; Henrik Sigstad
  3. Job Creation in a Multi-Sector Labor Market Model for Developing Economies By Basu, Arnab; Chau, Nancy H; Fields, Gary S; Kanbur, Ravi
  4. Labor Market Frictions, Human Capital Accumulation, and Consumption Inequality By Michael Graber; Jeremy Lise
  5. Weathering the Great Recession: Variation in Employment Responses by Establishments and Countries By Erling Barth; James Davis; Richard B. Freeman; Sari Pekkala Kerr

  1. By: Facundo Alvaredo; Anthony B. Atkinson; Salvatore Morelli
    Abstract: The concentration of personal wealth is now receiving a great deal of attention – after having been neglected for many years. One reason is the growing recognition that, in seeking explanations for rising income inequality, we need to look not only at wages and earned income but also at income from capital, particularly at the top of the distribution. In this paper, we use evidence from existing data sources to attempt to answer three questions: (i) What is the share of total personal wealth that is owned by the top 1 per cent, or the top 0.1 per cent? (ii) Is wealth much more unequally distributed than income? (iii) Is the concentration of wealth at the top increasing over time? The main conclusion of the paper is that the evidence about the UK concentration of wealth post-2000 is seriously incomplete and significant investment in a variety of sources is necessary if we are to provide satisfactory answers to the three questions.
    Keywords: wealth inequality; estate multiplier; investment income
    JEL: D3 H2
    Date: 2016–03–31
  2. By: Rolf Aaberge; A.B. Atkinson; Henrik Sigstad
    Abstract: The present paper brings together different features of the distribution of income - poverty, affluence and dispersion - in a single framework that allows ready comparisons across countries. We believe that such a unified framework contributes both to the policy debate and to the theoretical understanding of inequality. There are at present largely separate literatures on the measurement of poverty, and (to a limited degree) affluence, and on bi-polariszation. In relation to the EU social indicators, the paper may be seen as providing complementary information.
    Keywords: poverty, inequality, polarisation, affluence
    JEL: I31
    Date: 2015–12
  3. By: Basu, Arnab; Chau, Nancy H; Fields, Gary S; Kanbur, Ravi
    Abstract: This paper proposes an overlapping generations multi-sector model of the labor market for developing countries with three heterogeneities - heterogeneity within self-employment, heterogeneity in ability, and heterogeneity in age. We revisit an iconic paradox in a class of multisector labor market models in which the creation of high-wage employment exacerbates unemployment. Our richer setting allows for generational differences in the motivations for job search to be reflected in two distinct inverted U-shaped relationships between unemployment and high-wage employment, one for youth and a different one for adults. In turn, the relationship between overall unemployment and high-wage employment is shown to be non-monotonic and multi-peaked. The model also sheds light on the implications of increasing high-wage employment on self-employed workers, who make up most of the world's poor. Nonmonotonicity in unemployment notwithstanding, increasing high-wage employment has an unambiguous positive impact on high-paying self-employment, and an unambiguous negative impact on free-entry (low-wage) self-employment.
    Keywords: Harris- Todaro Model.; Multisector Labor Market; Overlapping Generations; Poverty Reduction
    JEL: I32 O17
    Date: 2016–07
  4. By: Michael Graber (UCL); Jeremy Lise (University College London)
    Abstract: We develop a frictional model of the labor market with stochastic human capital accumulation and incomplete markets. The stochastic process for human capital may be heterogeneous across workers as well as depend on the firm type where the worker is employed. We establish nonparametric identification of the model, and estimate it using matched employer-employee data from Germany. We provide a decomposition of lifecycle inequality in earnings and consumption resulting from heterogeneity in ability, heterogeneity in the rate of human capital accumulation, search frictions (the random allocation of similar workers to different jobs) and the interaction of human capital and search friction (a worker’s history of job opportunities may differentially affect her human capital accumulation opportunities).
    Date: 2016
  5. By: Erling Barth; James Davis; Richard B. Freeman; Sari Pekkala Kerr
    Abstract: Weathering the Great Recession: Variation in Employment Responses by Establishments and Countries
    Date: 2016–01

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