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on Unemployment, Inequality and Poverty |
| By: | Carlos Gradín (Universidade de Vigo); Gabriela Zapata-Román (Universidad Central de Chile) |
| Abstract: | We investigate the role of inherited circumstances in the inequality of opportunities in the labor market in Chile. We estimate the aggregate Shapley contribution of circumstances consistently across various measures reflecting legitimate views on inequality. We argue that the decomposition of path-dependent measures does not consider the effect of circumstances on inequality through the interaction of inequality between and within types. This largely overestimates their contribution using the Gini index and underestimates it with entropy measures. Circumstances explain 27-28 percent of inequality in 2022 using three entropy measures and 17 percent with extreme sensitivity to the poorest. They also explain 36 percent of inequality with the Gini index, which is less sensitive to both extremes and primarily affected by social stratification. Despite its persistence, inequality of opportunity has mainly driven inequality since the Great Recession. We also investigated population group contributions using a decomposition based on the Recentered Influence Function. |
| Keywords: | inequality decomposition, equality of opportunity, Shapley, RIF, Chile |
| JEL: | D63 O15 O54 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2024-676 |
| By: | Costa-Font, Joan (London School of Economics); Cowell, Frank A. (London School of Economics) |
| Abstract: | An individual's inequality aversion (IA) is a central preference parameter that captures the welfare sacrifice from exposure to inequality. However, it is far from trivial how to best elicit IA estimates. Also, little is known about the behavioural determinants of IA and how they differ across domains such as income and health. Using representative surveys from England, this paper elicits comparable estimates of IA in the health and income domains using two alternative elicitation techniques: a direct trade-off and an indirect "imaginary-grandchild" approach that results from the choices between hypothetical lotteries. We make three distinct contributions to the literature. First, we show that IA systematically differs between income and health domains. Average estimates are around 0.8 for income IA and range from 0.8 to 1.5 for health IA. Second, we find that risk aversion and locus of control are central determinants of IA in both income and health domains. Finally, we present evidence suggesting that the distribution and comparison of IA vary depending on the elicitation method employed. |
| Keywords: | inequality aversion, income inequality aversion, health inequality aversion, imaginary grandchild, inequality and efficiency trade-offs, risk attitudes, locus of control |
| JEL: | H1 I18 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17188 |
| By: | Ardila Brenoe, Anne (University of Zürich); Eyibak, Zeynep (University of Zürich); Heursen, Lea (Humboldt- Universität zu Berlin); Ranehill, Eva (Department of Economics, School of Business, Economics and Law, Göteborg University); Weber, Roberto A (University of Zürich) |
| Abstract: | Economic research on gender gaps in preferences and economic outcomes has focused on variation with respect to sex—abinary classification as either a “man” or “woman.” We validate a novel and simple measure of self-reported continuous gender identity (CGI) and explore whether gender identity correlates with variation in economic decisions and outcomes beyond the relationship with binary sex.We use four datasets (N=8, 073) measuring various dimensions of economic preferences and educational and labor market outcomes for which prior research has documented gaps between men and women. Our analysis rejects the null hypothesis that CGI has no relationship with behaviors and preferences beyond the relationship with binary sex, particularly for men, and suggests that incorporating self-reported measures of gender identity may have value for understanding gender gaps and for targeting policy. However, when considering specific domains, the relationships vary in statistical significance and are often small. |
| Keywords: | Gender identity; non-binary gender; economic preferences; economic outcomes |
| JEL: | C91 J16 J20 |
| Date: | 2024–09–05 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:gunwpe:0845 |
| By: | Bergvall, Sanna (Department of Economics, School of Business, Economics and Law, Göteborg University); Fernström, Clara (Stockholm Business School, Stockholm University); Ranehill, Eva (Department of Economics, School of Business, Economics and Law, Göteborg University); Sandberg, Anna (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | Recent self-reported and cross-sectional survey evidence documents high levels of mental health problems among PhD students. We study the impact of PhD studies on mental health care uptake using Swedish administrative records of prescriptions for psychiatric medication for the full population of PhD students. First, we provide descriptive evidence that PhD students collect psychiatric medication at a higher rate than a matched sample of individuals holding a master’s degree, but at a lower rate than a matched sample from the general population. Second, we implement an event study analysis and document that, in the years preceding their PhD studies, prospective students collect psychiatric medication at a rate similar to that of a matched sample of individuals holding a master’s degree. However, following the start of PhD studies, the use of psychiatric medication among PhD students increasessubstantially. This upward trend continues throughout the course of PhD studies, with estimates showing a 40 percent increase by the fifth year compared to pre-PhD levels. After the fifth year, which represents the average duration of PhD studies in our sample, we observe a notable decrease in the utilization of psychiatric medication. |
| Keywords: | Mental health; PhD studies; psychiatric medication |
| JEL: | I10 I23 |
| Date: | 2024–09–09 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:gunwpe:0846 |
| By: | Dirk Krueger (University of Pennsylvania, CEPR and NBER); Alexander Ludwig (Goethe University); Irina Popova (University of Bonn) |
| Abstract: | We evaluate the aggregate, distributional and welfare consequences of alternative government education policies to encourage college completion, such as making college free and improving funding for public schooling. To do so, we construct a general equilibrium overlapping generations model with intergenerational linkages, a higher education choice as well as a multi-stage human capital production process during childhood and adolescence with parental and government schooling investments. The model features rich cross-sectional heterogeneity, distinguishes between single and married parents, and is disciplined by US household survey data on income, wealth, education and time use. Studying the transitions induced by unexpected policy reforms we show that the “free college” and the “better schools” reform generate significant welfare gains, which take time to materialize and are lower in general than in partial equilibrium. It is optimal to combine both reforms: tuition subsidies make college affordable even for children from poorer parental backgrounds and better schools increase human capital thereby reducing dropout risk. |
| Keywords: | education spending, public transfers, welfare benefits, inequality, poverty, intergenerational persistence |
| JEL: | D15 D31 E24 I24 |
| Date: | 2024–08–18 |
| URL: | https://d.repec.org/n?u=RePEc:pen:papers:24-023 |