nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2019‒11‒25
six papers chosen by
Maximo Rossi
Universidad de la República

  1. Equality of opportunity in four measures of well-being By Xavier Ramos Morilla; Daniel Gerszon Mahler
  2. Time Discounting and Wealth Inequality By Epper, Thomas; Fehr, Ernst; Fehr-Duda, Helga; Thustrup Kreiner, Claus; Dreyer Lassen, David; Leth-Petersen, Søren; Nytoft Rasmussen, Gregers
  3. Economic Insecurity and the Rise of the Right By Walter Bossert; Andrew E. Clark; Conchita d'Ambrosio; Anthony Lepinteur
  4. Do Start-Up Subsidies for the Unemployed Affect Participants’ Well-Being? A Rigorous Look at (Un-)Intended Consequences of Labor Market Policies By Marco Caliendo; Stefan Tübbicke
  5. A Framework for Open Policy Analysis By Hoces de la Guardia, Fernando; Grant, Sean; Miguel, Edward
  6. How Would 401(k) ‘Rothification’ Alter Saving, Retirement Security, and Inequality? By Vanya Horneff; Raimond Maurer; Olivia S. Mitchell

  1. By: Xavier Ramos Morilla (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona); Daniel Gerszon Mahler (World Bank)
    Abstract: A growing literature has tried to measure the extent to which individuals have equal opportunities to acquire income. At the same time, policymakers have doubled down on e orts to go beyond income when designing policies to enhance well-being. We attempt to bridge these two areas by measuring the extent to which individuals have equal opportunities to achieve a high level of well-being. We use the German Socio-Economic Panel to measure well-being in four di erent ways including incomes. This makes it possible to determine if the way well-being is measured matters for identifying who the opportunity-deprived are and for tracking inequality of opportunity over time. We find that, regardless of how well-being is measured, the same people are opportunity-deprived and equality of opportunity has improved over the past 10 years. This suggests that going beyond income has little relevance if the objective is to provide equal opportunities.
    Keywords: Equality of opportunity, measurement, responsibility, e ort, well-being
    JEL: D3 D63 I31
    Date: 2018–12
    URL: http://d.repec.org/n?u=RePEc:uab:wprdea:wpdea1803&r=all
  2. By: Epper, Thomas; Fehr, Ernst; Fehr-Duda, Helga; Thustrup Kreiner, Claus; Dreyer Lassen, David; Leth-Petersen, Søren; Nytoft Rasmussen, Gregers
    Abstract: This paper documents a large association between individuals’ time discounting in incentivized experiments and their positions in the real-life wealth distribution derived from Danish highquality administrative data for a large sample of middle-aged individuals. The association is stable over time, exists through the wealth distribution and remains large after controlling for education, income profile, school grades, initial wealth, parental wealth, credit constraints, demographics, risk preferences and additional behavioral parameters. Our results suggest that savings behavior is a driver of the observed association between patience and wealth inequality as predicted by standard savings theory.
    Keywords: Wealth inequality, savings behavior, time discounting, experimental methods, administrative data
    JEL: C91 D31 E21
    Date: 2019–11
    URL: http://d.repec.org/n?u=RePEc:usg:econwp:2019:16&r=all
  3. By: Walter Bossert (CIREQ - Centre interuniversitaire de recherche en économie quantitative, University of Montreal - University of Montreal); Andrew E. Clark (PSE - Paris School of Economics, 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); Conchita d'Ambrosio (INSIDE - INtegrative research unit on Social and Individual DEvelopment - University of Luxembourg [Luxembourg]); Anthony Lepinteur (INSIDE - INtegrative research unit on Social and Individual DEvelopment - University of Luxembourg [Luxembourg])
    Abstract: Economic insecurity has attracted growing attention in social, academic and policy cir- cles. However, there is no consensus as to its precise de_nition. Intuitively, economic insecurity is multi-faceted, making any comprehensive formal de_nition that subsumes all possible aspects extremely challenging. We propose a simpli_ed approach, and character- ize a class of individual economic-insecurity measures that are based on the time pro_le of economic resources. We then apply our economic-insecurity measure to data on political preferences. In US, UK and German panel data, and conditional on current economic resources, economic insecurity is associated with both greater political participation (sup- port for a party or the intention to vote) and notably more support for parties on the right of the political spectrum. We in particular _nd that economic insecurity predicts greater support for both Donald Trump before the 2016 US Presidential election and the UK leaving the European Union in the 2016 Brexit referendum.
    Keywords: Economic index numbers,Insecurity,Political participation,Conservatism,Right-leaning political parties,Trump,Brexit
    Date: 2019–10
    URL: http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-02325984&r=all
  4. By: Marco Caliendo (University of Potsdam, IZA Bonn, DIW Berlin, IAB Nuremberg); Stefan Tübbicke (University of Potsdam)
    Abstract: We estimate the long-term effects of start-up subsidies (SUS) for the unemployed on subjective outcome indicators of well-being, as measured by the participants’ satisfaction in different domains. This extends previous analyses of the current German SUS program (“Gründungszuschuss”) that focused on objective outcomes – such as employment and income – and allows us to make a more complete judgment about the overall effects of SUS at the individual level. This is especially important because subsidizing the transition into self-employment may have unintended adverse effects on participants’ well-being due to its risky nature and lower social security protection, especially in the long run. Having access to linked administrative-survey data providing us with rich information on pre-treatment characteristics, we base our analysis on the conditional independence assumption and use propensity score matching to estimate causal effects within the potential outcomes framework. We find long-term positive effects on job satisfaction but negative effects on individuals’ satisfaction with their social security situation. Further findings suggest that the negative effect on satisfaction with social security may be driven by negative effects on unemployment and retirement insurance coverage. Our heterogeneity analysis reveals substantial variation in effects across gender, age groups and skill levels. The sensitivity analyses show that these findings are highly robust.
    Keywords: Start-Up Subsidies, Propensity Score Matching, Counterfactual Analysis, Well-Being
    JEL: C14 L26 H43 I31 J68
    Date: 2019–11
    URL: http://d.repec.org/n?u=RePEc:pot:cepadp:14&r=all
  5. By: Hoces de la Guardia, Fernando; Grant, Sean (Indiana University); Miguel, Edward
    Abstract: The evidence-based policy movement promotes the use of empirical evidence to inform policy decision-making. While this movement has gained traction over the last two decades, concerns about the credibility of empirical research have been identified in scientific disciplines that use research methods and practices that are commonplace in policy analysis. As a solution, we argue that policy analysis should adopt the transparent, open, and reproducible research practices increasingly espoused in related disciplines. We first discuss the importance of evidence-based policy in an era of increasing disagreement about facts, analysis, and expertise. We review recent credibility crises of empirical research, and their relevance to the credibility of evidence-based policy. We then make the case for “open” policy analysis (OPA) and how to achieve it, focusing on examples of recent policy analyses that have incorporated open research practices such as transparent reporting, open data, and code sharing. We conclude with recommendations on how key stakeholders in evidence-based policy can make OPA the norm and thus safeguard trust in using empirical evidence to inform important policy decisions.
    Date: 2018–03–26
    URL: http://d.repec.org/n?u=RePEc:osf:metaar:jnyqh&r=all
  6. By: Vanya Horneff; Raimond Maurer; Olivia S. Mitchell
    Abstract: The US has long incentivized retirement saving in 401(k) and similar retirement accounts by permitting workers to defer taxes on contributions, levying them instead when retirees withdraw funds in retirement. This paper develops a dynamic life cycle model to show how and whether ‘Rothification’ – that is, taxing 401(k) contributions rather than payouts – would alter household saving, investment, and Social Security claiming patterns. We show that these changes differ importantly for low- versus higher-paid workers. We conclude that moving to a system that taxes pension contributions instead of withdrawals will lead to later retirement ages, particularly for the better-educated. It also would reduce work hours and lifetime tax payments and increase wealth and consumption inequality. In addition, we show how these behaviors would differ in a persistently low interest rate environment versus a more “normal” historical return world.
    JEL: D14 D91 G11 G22 G23 G28
    Date: 2019–11
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:26437&r=all

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