nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2018‒02‒19
eleven papers chosen by
Maximo Rossi
Universidad de la República

  1. Unhappiness and Pain in Modern America: A Review Essay, and Further Evidence, on Carol Graham’s Happiness for All? By Blanchflower, David G.; Oswald, Andrew J
  2. Parents, Siblings and Schoolmates. The Effects of Family-School Interactions on Educational Achievement and Long-term Labor Market Outcomes. By Marco Bertoni; Giorgio Brunello; Lorenzo Cappellari
  3. Unfairness at Work: Well-Being and Quits By D'Ambrosio, Conchita; Clark, Andrew E.; Barazzetta, Marta
  4. Understanding Earnings, Labor Supply, and Retirement Decisions By Xiaodong Fan; Ananth Seshadri; Christopher Taber
  5. 'A Theory of Social Norms, Women's Time Allocation, and Gender Inequality in the Process of Development' By Pierre-Richard Agénor
  6. Is Envy Harmful to a Society’s Psychological Health and Wellbeing? A Longitudinal Study of 18,000 Adults By Mujcic, Redzo; Oswald, Andrew J
  7. Measuring the Distribution of Household Income, Consumption and Wealth: State of Play and Measurement Challenges By Nora Lustig
  8. Do CCTs Improve Employment and Earnings in the Very Long-Term? Evidence from Mexico By Adriana D. Kugler; Ingrid Rojas
  9. Performance and Inequality in Health: A Comparison of Child and Maternal Health across Asia By Bénédicte H. Apouey; Jacques Silber
  10. Overeducation wage penalty among Ph.D. holders. An unconditional quantile regression analysis on Italian data By Gaeta, Giuseppe Lucio; Lubrano Lavadera, Giuseppe; Pastore, Francesco
  11. Social Insurance and Occupational Mobility By German Cubas; Pedro Silos

  1. By: Blanchflower, David G. (Dartmouth College, Stirling, NBER, Bloomberg and IZA); Oswald, Andrew J (University of Warwick, CAGE, and IZA)
    Abstract: In Happiness for All?, Carol Graham raises disquieting ideas about today’s United States. The challenge she puts forward is an important one. Here we review the intellectual case and offer additional evidence. We conclude broadly on the author’s side. Strikingly, Americans appear to be in greater pain than citizens of other countries, and most subgroups of citizens have downwardly trended happiness levels. There is, however, one bright side to an otherwise dark story. The happiness of black Americans has risen strongly since the 1970s. It is now almost equal to that of white Americans.
    Keywords: Happiness ; well-being ; GHQ ; mental-health ; depression ; life-course
    JEL: I3 I31
    Date: 2018
    URL: http://d.repec.org/n?u=RePEc:wrk:warwec:1153&r=ltv
  2. By: Marco Bertoni; Giorgio Brunello; Lorenzo Cappellari (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore)
    Abstract: We investigate whether the effects of schoolmates’ gender and average parental education on educational achievement, employment and earnings vary with individual family characteristics such as the gender of siblings and own parental education. We find that the benefits from exposure to “privileged” peers accrue mainly to “disadvantaged” students and decline when the dispersion of parental education in the school increases. We also show that boys with sisters who are exposed to a higher share of girls at school have poorer employment prospects. The opposite is true for girls who have sisters. Overall, the size of the estimated effects is small.
    Keywords: education peer effects, gender, parental background, human capital production, long term outcomes.
    JEL: I21 J16 J24
    Date: 2018–01
    URL: http://d.repec.org/n?u=RePEc:ctc:serie1:def064&r=ltv
  3. By: D'Ambrosio, Conchita; Clark, Andrew E.; Barazzetta, Marta
    Abstract: We here consider the effect of the level of income that individuals consider to be fair for the job they do, which we take as measure of comparison income, on both subjective well-being and objective future job quitting. In six waves of German Socio-Economic Panel data, the extent to which own labour income is perceived to be unfair is significantly negatively correlated with subjective well-being, both in terms of cognitive evaluations (life and job satisfaction) and affect (the frequency of feeling happy, sad and angry). Perceived unfairness also translates into objective labour-market behaviour, with current unfair income predicting future job quits.
    Keywords: Fair income, subjective well-being, quits, SOEP
    URL: http://d.repec.org/n?u=RePEc:cpm:docweb:1802&r=ltv
  4. By: Xiaodong Fan (University of New South Wales); Ananth Seshadri (University of Wisconsin-Madison); Christopher Taber (University of Wisconsin-Madison)
    Abstract: We develop and estimate a model in which individuals make decisions on consumption, human capital investment, labor supply, and retirement. Unlike all previous work, our model allows both an endogenous wage process (which is typically assumed exogenous in the human capital and earnings dynamics literature). In addition, we introduce health shocks. We estimate the model and match the life-cycle profiles of wages, hours and retirement from SIPP data. We analyze the impact of health shocks on retirement, as well as the effect of changes in payroll taxes and increases in the Normal Retirement Age on labor force participation of older Americans.
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:mrr:papers:wp367&r=ltv
  5. By: Pierre-Richard Agénor
    Abstract: This paper studies how social norms influence gender bias in the workplace and in the family, how these two forms of discrimination interact among themselves and with intra-household bargaining, and how gender norms evolve in the course of development. The presence of women in the labor market is a key determinant of the degree of gender bias in the workplace. Household preferences towards girls' education depend on women's bargaining power which, through the male-female wage gap, depends itself on gender bias in the labor market. Experiments with a calibrated version of the model for a stylized low-income country show that interactions between social norms, women's time allocation, and gender gaps are a critical source of growth dynamics. Initial measures aimed at mitigating the influence of discriminatory norms regarding gender roles in the workplace and in the family can magnify over time the benefits of standard policy prescriptions (aimed for instance at fostering childhood education) in promoting development and gender equality.
    Date: 2018
    URL: http://d.repec.org/n?u=RePEc:man:cgbcrp:237&r=ltv
  6. By: Mujcic, Redzo; Oswald, Andrew J (University of Warwick, CAGE, and IZA)
    Abstract: Nearly 100 years ago, the philosopher and mathematician Bertrand Russell warned of the social dangers of widespread envy. One view of modern society is that it is systematically developing a set of institutions -- such as social media and new forms of advertising -- that make people feel inadequate and envious of others. If so, how might that be influencing the psychological health of our citizens? This paper reports the first large-scale longitudinal research into envy and its possible repercussions. The paper studies 18,000 randomly selected individuals over the years 2005, 2009, and 2013. Using measures of SF-36 mental health and psychological well-being, four main conclusions emerge. First, the young are especially susceptible. Levels of envy fall as people grow older. This longitudinal finding is consistent with a cross-sectional pattern noted recently by Nicole E. Henniger and Christine R. Harris, and with the theory of socioemotional regulation suggested by scholars such as Laura L. Carstensen. Second, using fixed-effects equations and prospective analysis, the analysis reveals that envy today is a powerful predictor of worse SF-36 mental health and well-being in the future. A change from the lowest to the highest level of envy, for example, is associated with a worsening of SF-36 mental health by approximately half a standard deviation (p
    Keywords: Envy ; age ; SF-36 ; mental health ; well-being ; longitudinal data
    Date: 2018
    URL: http://d.repec.org/n?u=RePEc:wrk:warwec:1154&r=ltv
  7. By: Nora Lustig (Department of Economics, Tulane University)
    Abstract: This paper focuses on the data challenges encountered while measuring vertical economic inequality, i.e. inequality of income and consumption, and-whenever feasible-wealth, among households or individuals ranked by the level of their economic resources. The paper presents a critical assessment of international databases on inequality. Among the worrisome facts is that international databases not only show different levels of inequality but, for some countries (especially in Sub-Saharan Africa), diverging trends also. A key factor behind the limitations of existing databases is the quality of the underlying household surveys (microdata) used as inputs for their construction. Among the salient challenges is that household surveys suffer from undercoverage and underreporting of top incomes, i.e. the "missing rich". Missing the rich introduces a bias in the measured inequality indicators, a bias that could go in either direction. Another limitation in existing inequality indicators is that the typical welfare metrics are disposable income and/or consumption expenditures; these, however, take into account only part of the effect that taxes and transfers have on people's economic well-being. The paper suggests that a more comprehensive assessment needs to use an income variable that includes social transfers in-kind (especially education and health), and adds the effect of consumption taxes and subsidies as well.
    Keywords: Inequality, international databases, household surveys, top incomes, economic well-being, taxes, cash and in-kind transfers
    JEL: C81 D31 D63 H41
    Date: 2018–01
    URL: http://d.repec.org/n?u=RePEc:tul:wpaper:1801&r=ltv
  8. By: Adriana D. Kugler; Ingrid Rojas
    Abstract: We assess long-term impacts of the Mexican conditional cash transfer (CCT) program on youth employment and earnings. We rely on the original random assignment into early and late treatment localities, which introduced CCTs in 1998 and 2000. We focus on children between 7 and 16 years of age in 1997, who we follow up to 17 years later. Using the household surveys between 2003 and 2015, we find that those with greater time of exposure to CCTs had greater increases in educational attainment. Moreover, we find significant and positive impacts of the program on the likelihood and quality of employment.
    JEL: I38 J24 O38
    Date: 2018–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:24248&r=ltv
  9. By: Bénédicte H. Apouey (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Jacques Silber (Bar-Ilan University [Israël])
    Abstract: A country's performance in health attainment refers to both its achievement (level) and its improvement (evolution) in the health domain. Studies on performance generally measure health attainment using the average health level of the population, and quantify health improvement employing the change in attainment over time. However this approach is flawed because the change in attainment does not satisfy good properties, on the one hand, and because health attainment should not only account for the average health level, but also for disparities in health in the population, on the other hand. We propose a solution to the first limitation by following the lead of Kakwani (1993), who uses achievement and improvement measures which are based on attainment measures and which satisfy important properties. For the second limitation, we extend the work of Kakwani and propose new definitions of attainment that account for the average health level but also for health inequalities in the population. Specifically, we focus on overall and social health inequalities and on the health of the poor. By including these new attainment variables into Kakwani's indices, we generate new classes of achievement and improvement indices. Using data on 11 low and middle-income Asian countries in the twenty-first century, we highlight that child and maternal health have generally improved in recent decades, due to both an increase in the average health level and a decrease in inequalities.
    Date: 2016
    URL: http://d.repec.org/n?u=RePEc:hal:journl:halshs-01599558&r=ltv
  10. By: Gaeta, Giuseppe Lucio; Lubrano Lavadera, Giuseppe; Pastore, Francesco
    Abstract: The wage effect of overeducation has only recently been investigated in the case of Ph.D. holders. The existing contributions rely on OLS estimates that allow measuring the average effect of being educationally mismatched at the mean of the conditional wage distribution. This paper, instead, observes the heterogeneity of the overeducation penalty along the hourly wage distribution and according to the study field and sector of employment (academic/non-academic) of Ph.D. holders. We estimate a Recentered Influence Function. The results reveal that overeducation hits the wages of those Ph.D. holders who are employed in the academic sector and in non-R&D jobs outside of the academic sector. Instead, no penalty exists among those who carry out R&D outside the Academia. The size of the penalty is higher among those who are in the mid-top of the wage distribution and hold a Social Science and Humanities specialization.
    Keywords: Job-education mismatch,Overeducation,Wages,Ph.D. holders,Unconditional quantile regression,Italy
    JEL: C26 I23 J13 J24 J28
    Date: 2018
    URL: http://d.repec.org/n?u=RePEc:zbw:glodps:180&r=ltv
  11. By: German Cubas (Department of Economics, University of Houston); Pedro Silos (Department of Economics, Temple University)
    Abstract: This paper studies how insurance from progressive taxation improves the matching of workers to occupations. We propose an equilibrium dynamic assignment model to illustrate how social insurance encourages mobility. Workers experiment to find their best occupational fit in a process filled with uncertainty. Risk aversion and limited earnings insurance induce workers to remain in unfitting occupations. We estimate the model using microdata from the United States and Germany. Higher earnings uncertainty explains the U.S. higher mobility rate. When workers in the United States enjoy Germany's higher progressivity, mobility rises. Output and welfare gains are large.
    Keywords: Progressive Taxation, Social Insurance, Occupational Choice
    JEL: E21 H24 J31
    Date: 2018–02
    URL: http://d.repec.org/n?u=RePEc:tem:wpaper:1802&r=ltv

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