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on Unemployment, Inequality and Poverty |
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Issue of 2022‒10‒31
six papers chosen by |
| By: | Ferreira,Francisco H. G. |
| Abstract: | This paper assesses the evolution of thinking, analysis, and discourse about inequality in theWorld Bank and the International Monetary Fund since their inception in 1944, on the basis of bibliometric analysis, areading of the literature, and personal experience. Whereas the Fund was largely unconcerned with economic inequalityuntil the 2000s but has shown a rapidly growing interest since then, the Bank’s approach has been characterized byebbs and flows, with five phases being apparent. The degree of interest in inequality in the two institutions appears tobe largely determined by the prevailing intellectual profile of the topic in academic research, particularly ineconomics, and by ideological shifts in major shareholder countries, propagated downward internally by seniormanagement. Data availability, albeit partly endogenous, also plays a role. Looking ahead, World Bank andInternational Monetary Fund researchers continue to have an important role to play, despite a much more crowded field ininequality research. The paper suggests that this role involves holding firm to an emphasis on inequality “at thebottom” and highlighting four themes that may deserve special attention. |
| Date: | 2022–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10149&r= |
| By: | N. Meltem Daysal (University of Copenhagen; CEBI; IZA); Michael F. Lovenheim (Cornell University, NBER, and CESifo); David Wasser (Cornell University) |
| Abstract: | Rising wealth inequality has spurred an increased interest in understanding how and why wealth is correlated across generations. Prior research has found an intergenerational correlation between 0.2 and 0.4 and has emphasized the role of family characteristics in driving this correlation. We contribute to this literature by examining the intergenerational transmission of wealth changes, which allows us to isolate the causal effect of wealth shocks from predetermined parental preferences and household characteristics. Using Danish Register Data, we examine the effect of home price changes that occur between ages 0-5, 6-11, and 12-17 on the value of the home children own at ages 29-33. For the youngest age group, we find that 12.7% of each Krone of home price change is transmitted to housing wealth in adulthood. The transmission rate for the 6-11 age group is higher, at 20.5%, and there is no transmission of home price changes that occur during the teenage years. Examining mechanisms, we find that home price increases in the first two age groups lead to modest increases in home ownership and educational attainment. There also is an increase in non-housing wealth, income, and partner wealth for the middle age group. Income and education can explain only 20-30% of the intergenerational transmission we document. We argue that our results largely reflect changes to parental/household behaviors and preferences that are passed down to children and cause them to accumulate more housing wealth in young adulthood. |
| Keywords: | Intergenerational wealth transmission, housing wealth |
| JEL: | J62 R31 I20 |
| Date: | 2022–10–03 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kucebi:2221&r= |
| By: | Jorge Luis García; James J. Heckman |
| Abstract: | This paper examines the economic foundations of three criteria used for evaluating the costs and benefits of social programs. Some criteria do not consider the scale of programs or address the costs associated with programs that expand or contract the total government budget. A recent addition to the list of evaluation criteria--the marginal value of public funds (MVPF)--does not adopt a social optimality perspective. It evaluates the optimality of expenditures assuming a predetermined aggregate budget without considering the social costs of raising that budget. |
| JEL: | D61 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30507&r= |
| By: | Lokshin,Michael M.; Ravallion,Martin; Torre,Ivan |
| Abstract: | The claim that social protection is a luxury good—with a national income elasticity exceedingunity—has been influential. The paper tests the “luxury good hypothesis” using newly-assembled data on social protectionspending across countries since 1995, treating the pandemic period separately, as it entailed a large expansion insocial protection efforts. While the mean income share devoted to social protection rises with income, this isattributable to multiple confounders, including relative prices, weak governance in low-income countries and accessto information-communication technologies. Controlling for these, social protection is not a luxury good. This was alsotrue during the pandemic. |
| Date: | 2022–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10174&r= |
| By: | David Card; Stefano DellaVigna; Patricia Funk; Nagore Iriberri |
| Abstract: | Historically, a large majority of the newly elected members of the National Academy of Science (NAS) and the American Academy of Arts and Science (AAAS) were men. Within the past two decades, however, that situation has changed, and in the last 3 years women made up about 40 percent of the new members in both academies. We build lists of active scholars from publications in the top journals in three fields – Psychology, Mathematics and Economics – and develop a series of models to compare changes in the probability of selection of women as members of the NAS and AAAS from the 1960s to today, controlling for publications and citations. In the early years of our sample, women were less likely to be selected as members than men with similar records. By the 1990s, the selection process at both academies was approximately gender-neutral, conditional on publications and citations. In the past 20 years, however, a positive preference for female members has emerged and strengthened in all three fields. Currently, women are 3-15 times more likely to be selected as members of the AAAS and NAS than men with similar publication and citation records. |
| JEL: | J15 J16 O30 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30510&r= |
| By: | Daron Acemoglu; Jonas Loebbing |
| Abstract: | We develop an assignment model of automation. Each of a continuum of tasks of variable complexity is assigned to either capital or one of a continuum of labor skills. We characterize conditions for interior automation, whereby tasks of intermediate complexity are assigned to capital. Interior automation arises when the most skilled workers have a comparative advantage in the most complex tasks relative to capital, and because the wages of the least skilled workers are sufficiently low relative to their productivity and the effective cost of capital in low-complexity tasks. Minimum wages and other sources of higher wages at the bottom make interior automation less likely. Starting with interior automation, a reduction in the cost of capital (or an increase in capital productivity) causes employment and wage polarization. Specifically, further automation pushes workers into tasks at the lower and upper ends of the task distribution. It also monotonically increases the skill premium above a skill threshold and reduces the skill premium below this threshold. Moreover, automation tends to reduce the real wage of workers with comparative advantage profiles close to that of capital. We show that large enough increases in capital productivity ultimately induce a transition to low-skill automation and qualitatively alter the effects of automation - thereafter inducing monotone increases in skill premia rather than wage polarization. |
| JEL: | J23 J31 O33 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30528&r= |