nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2023‒04‒10
eleven papers chosen by
Maximo Rossi
Universidad de la República

  1. The Effect of the Minimum Wage in Latin America's six largest economies By Lucía Ramírez Leira; Carlo Lombardo; Leonardo Gasparini
  2. A decomposition method to evaluate the "paradox of progress", with evidence for Argentina By Walter Sosa Escudero; Javier Alejo; Leonardo Gasparini; Gabriel Montes Rojas
  3. A Trajectories-Based Approach to Measuring Intergenerational Mobility By Yoosoon Chang; Steven N. Durlauf; Seunghee Lee; Joon Y. Park
  4. Measuring top income shares in the UK By Advani, Arun; Summers, Andy; Tarrant, Hannah
  5. Inequality of opportunity and intergenerational persistence in Latin America By Paolo Brunori; Francisco H.G. Ferreira; Guido Neidhöfer
  6. Reconciling reports: modelling employment earnings and measurement errors using linked survey and administrative data By Jenkins, Stephen P.; Rios-Avila, Fernando
  7. Intergenerational Correlations in Longevity By Sandra E. Black; Neil Duzett; Adriana Lleras-Muney; Nolan G. Pope; Joseph Price
  8. The impact of robots in Latin America: Evidence from local labor markets By Andrés César; Guillermo Falcone; Irene Brambilla; Leonardo Gasparini
  9. A Human Capital Theory of Who Escapes the Grasp of the Local Monopsonist By Matthew E. Kahn; Joseph Tracy
  10. How Are Gender Norms Perceived? By Bursztyn, Leonardo; Cappelen, Alexander; Tungodden, Bertil; Voena, Alessandra; Yanagizawa-Drott, David
  11. Growth and immigration: unpicking the confusion By Alan Manning

  1. By: Lucía Ramírez Leira; Carlo Lombardo; Leonardo Gasparini
    Keywords: Minimum Wage, Wages, Labor Markets, Inequality, Informality, Latin America
    JEL: J22 J38 J31 K31
    Date: 2021–11
  2. By: Walter Sosa Escudero; Javier Alejo; Leonardo Gasparini; Gabriel Montes Rojas
    Keywords: inequality, quantile regression, education
    JEL: J31 C21
    Date: 2021–11
  3. By: Yoosoon Chang; Steven N. Durlauf; Seunghee Lee; Joon Y. Park
    Abstract: This paper develops an approach to intergenerational mobility in which the trajectories of parental incomes during childhood and adolescence are the conditioning objects for characterizing dependence across generations. We use functional regression methods to produce an intergenerational elasticity curve that measures how marginal changes in income at each age affect expected offspring permanent income. Using the PSID, estimates of this curve exhibit near monotonicity with respect to age, so that parental incomes in middle childhood and adolescence have larger marginal effects than incomes in early childhood. When interactions are allowed to occur between incomes at different ages, we find a complex pattern of substitutability between incomes at ages that are close in time versus complementarity between parental incomes for ages early childhood and adolescence. Qualitatively similar results hold for offspring education while we do not find evidence of age-specific effects for occupation. We conclude that important information about the links between parental incomes and children exists beyond the scalar characterization of parental permanent income.
    JEL: C13 J62
    Date: 2023–03
  4. By: Advani, Arun (University of Warwick, CAGE, the Institute for Fiscal Studies (IFS), and the LSE International Inequalities Institute (III)); Summers, Andy (London School of Economics, LSE III, CAGE and IFS); Tarrant, Hannah (London School of EconomicsLSE III.)
    Abstract: Information about the share of total income held by the richest 1%, or other top income groups, is increasingly used to discuss inequality levels and trends within and between nations. A top income share is the ratio of the total income held by the top income group divided by total personal income (the ‘income control total’). We compare two approaches to estimating income control totals: the ‘external’ approach used by the World Inequality Database, and an augmented ‘internal’ approach. We argue in favour of the latter, with reference to five desirable properties that a top share series would ideally possess. The choice matters: our augmented ‘internal’ approach yields estimates of the UK top 1% share that are around 2 percentage points higher than the ‘external’ approach.
    Keywords: income inequality, measurement, national accounts, top shares JEL Classification:
    Date: 2022
  5. By: Paolo Brunori; Francisco H.G. Ferreira; Guido Neidhöfer
    Abstract: How strong is the transmission of socio-economic status across generations in Latin America? To answer this question, we first review the empirical literature on intergenerational mobility and inequality of opportunity for the region, summarizing results for both income and educational outcomes.
    Keywords: Inequality of opportunities, Intergenerational Mobility, Latin America
    Date: 2023
  6. By: Jenkins, Stephen P.; Rios-Avila, Fernando
    Abstract: We develop and apply new statistical models for linked survey and administrative data on employment earnings that generalize those of Kapteyn and Ypma (Journal of Labor Economics, 2007). Our models incorporate four types of measurement error: mean-reverting measurement error in the survey data; ‘reference period’ error (mismatch between survey and administrative data definitions); error in the linking of survey and administrative data; and mean-reverting measurement error in the administrative data. In addition, we allow error distributions to differ with individual characteristics, which improves model fit and allows us to investigate substantive hypotheses about factors associated with error bias and variance. Using individual-level data from the 2011/12 Family Resources Survey linked with administrative data based on Pay As You Earn records (P14 data) for the same individuals, we contribute the first UK evidence to a field dominated by findings about the USA. We show that measurement errors are pervasive, but the four types are quite different in nature. We also document substantial heterogeneity in each of the error distributions.
    Keywords: measurement error; linkage error; earnings; linked data and administrative data; finite mixture models; Family Resources Survey; P14 data; PAYE data; OUP deal
    JEL: C1
    Date: 2023–01–31
  7. By: Sandra E. Black; Neil Duzett; Adriana Lleras-Muney; Nolan G. Pope; Joseph Price
    Abstract: While there is substantial research on the intergenerational persistence of economic outcomes such as income and wealth, much less is known about intergenerational persistence in health. We examine the correlation in longevity (an overall measure of health) across generations using a unique dataset containing information about more than 26 million families obtained from the Family Search Family Tree. We find that the intergenerational correlation in longevity is 0.09 and rises to 0.14 if we consider the correlation between children and the average of their parents' longevity. This intergenerational persistence in longevity is much smaller than that of persistence in socio-economic status and lower than existing correlations in health. Moreover, this correlation remained low throughout the 19th and early 20th centuries despite dramatic changes in longevity and its determinants. We also document that the correlations in longevity and in education are largely independent of each other. These patterns are likely explained by the fact that stochastic factors play a large role in the determination of longevity, larger than for other outcomes.
    JEL: I1 I30 J6
    Date: 2023–03
  8. By: Andrés César; Guillermo Falcone; Irene Brambilla; Leonardo Gasparini
    Keywords: Robots, Labor markets, Latin America
    JEL: J23 J24
    Date: 2021–11
  9. By: Matthew E. Kahn; Joseph Tracy
    Abstract: Over the last thirty years, there has been a rise in several empirical measures of local labor market monopsony power. The monopsonist has a profit incentive to offer lower wages to local workers. Mobile high skill workers can avoid the lower monopsony wages by moving to other more competitive local labor markets featuring a higher skill price vector. We develop a Roy Model of heterogeneous worker sorting across local labor markets that has several empirical implications. Monopsony markets are predicted to experience a “brain drain” over time. Using data over four decades we document this deskilling associated with local monopsony power. This means that observed cross-sectional wage gaps in monopsony markets partially reflects sorting on worker ability. The rise of work from home may act as a substitute for high-skill worker migration from monopsony markets.
    JEL: J42
    Date: 2023–03
  10. By: Bursztyn, Leonardo (University of Chicago); Cappelen, Alexander (Dept. of Economics, Norwegian School of Economics and Business Administration); Tungodden, Bertil (Dept. of Economics, Norwegian School of Economics and Business Administration); Voena, Alessandra (Stanford University); Yanagizawa-Drott, David (Zurich University)
    Abstract: Actual and perceived gender norms are key to understanding gender inequality. Using newly-collected, nationally representative datasets from 60 countries covering 80% of the world population, this paper studies gender norms on two policy issues: basic rights, allowing women to work outside of the home, and affirmative action, prioritizing women when hiring for leadership positions. Misperceptions of gender norms are pervasive across the world, and the nature of the misperception is context-dependent. In less gender-equal countries, people underestimate support for both policies, particularly support among men; in more gender-equal countries, people overestimate support for affirmative action, particularly support among women, and underestimate support for basic rights. Gender stereotyping and overweighting of minority views are potential drivers of the global patterns of misperceptions. Our findings indicate how misperceptions of gender norms may obstruct progress toward gender equality and contribute to sustaining gender policies that are not necessarily favored by women.
    Keywords: Social norms; misperceptions; gender
    JEL: J00 J16
    Date: 2023–03–22
  11. By: Alan Manning
    Abstract: More people in a country leads to a bigger economy, but not necessarily an improved standard of living. Alan Manning unpicks the complexities in the debate.
    Keywords: immigration, GDP, growth, UK Economy, labour markets, Wages
    Date: 2023–02–21

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