|
on Unemployment, Inequality and Poverty |
|
Issue of 2022‒09‒26
seven papers chosen by |
| By: | Eshaghnia, Sadegh S. M. (University of Chicago); Heckman, James J. (University of Chicago); Landerso, Rasmus (Rockwool Foundation Research Unit); Qureshi, Rafeh (University of Chicago) |
| Abstract: | This paper studies intergenerational mobility—the transmission of family influence. We develop and estimate measures of lifetime resources (income and wealth) motivated by economic theory that account for generational differences in life-cycle trajectories, uncertainty, and credit constraints. These measures of lifetime resources allow us to estimate the transmission of welfare and lifetime resources at different stages of the life cycle. We compare these measures with traditional ones such as wage income and disposable income measured over narrow windows of age that are used to proxy lifetime wealth. The performance of proxy measures is poor. Parents' expected lifetime resources are stronger predictors of many important child outcomes (including children's own expected lifetime resources and education) than the income measures traditionally used in the literature on social mobility. Changes in patterns of educational attainment across generations explain most of the intergenerational change in life-cycle dynamics. While relative mobility is overstated by the traditional income measures, absolute upward mobility is understated. Recent generations have higher welfare and are better off compared to their parents. |
| Keywords: | intergenerational mobility, life-cycle measures of resources, education |
| JEL: | I24 D31 I30 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15504&r= |
| By: | Zhan, Crystal; Deole, Sumit |
| Abstract: | Classical theories hypothesize individual economic preferences, including preferences toward risk, time, and trust, as determinants for migration intention. In the paper, we combine data from the German Socio-Economic Panel, European Social Survey, and World Values Survey to investigate how immigrants to Germany are self-selected from the origin population based on their preferences. We find a higher migration propensity among individuals who are more altruistic, patient, and trusting, conditional on age, gender, education, and a series of origin country's economic and political factors. However, individuals are positively selected on risk appetite in low-risk countries but adversely selected in high-risk countries. The degree of selectivity regarding preferences is also heterogeneous across demographics and origin-country characteristics. |
| Keywords: | self-selection,economic preferences,refugees,reasons for migration,origin country |
| JEL: | F22 J15 J6 O15 Z1 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1156&r= |
| By: | Lisa A. Gennetian; Greg Duncan; Nathan A. Fox; Katherine Magnuson; Sarah Halpern-Meekin; Kimberly G. Noble; Hirokazu Yoshikawa |
| Abstract: | A key policy question in evaluating social programs to address childhood poverty is how families receiving unconditional financial support would spend those funds. Economists have limited empirical evidence on this topic in the U.S. We provide causal estimates of financial and time investments in infants among families living in poverty from a large-scale, multi-site randomized controlled study of monthly unconditional cash transfers starting at the time of a child’s birth. We find that the cash transfers increased spending on child-specific goods and mothers’ early-learning activities with their infants. The marginal propensity to consume child-focused items from the cash transfer exceeded that from other income, consistent with the behavioral cues in the cash transfer design. We find no statistically detectable offsets in household earnings nor statistically detectable impacts in other pre-registered outcomes related to general household expenditures, maternal labor supply, infants’ time in childcare, or mothers’ subjective well-being. |
| JEL: | D13 H31 I30 J13 J18 J22 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30379&r= |
| By: | Martin Ravallion |
| Abstract: | Thirty years ago, Nanak Kakwani provided elegant nonparametric formulae for the point elasticities of measures of poverty with respect to changes in the mean of the distribution of income, thus analytically linking the poverty measures to key macroeconomic aggregates. Numerous insights are found in Kakwani’s elasticities. However, the literature on poverty and growth since then has revealed that the impacts of economic growth on poverty, as observed in practice, can be substantially lower than suggested by Kakwani’s elasticities; the reasons include rising inequality, measurement errors, discrepancies between surveys and national accounts, and changing ideas about what “poverty” means in specific contexts. Nor should Kakwani’s elasticities be treated as structural parameters. Rather, they can vary over time and place, and in systematic ways that merit closer attention. |
| JEL: | I32 O15 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30401&r= |
| By: | Celidoni, Martina (University of Padova); Costa-Font, Joan (London School of Economics); Salmasi, Luca (Catholic University - Rome) |
| Abstract: | Longevity expectations (LE) are subjective assessments of future health status that can influence a number of individual health protective decisions. This is especially true during a pandemic such as COVID-19, as the risk of ill health depends more than ever on such protective decisions. This paper exploits differences in LE to examine the causal effect of LE on protective health behaviours and a number of decisions around access to health care, using data from the Survey of Health Ageing and Retirement in Europe. We draw on an instrumental variable strategy exploiting individual level information on parental age at death. Consistent with the too healthy to be sick hypothesis, we find that individuals with higher expected longevity are more likely to engage in protective behaviours, and are less likely to forgo medical treatment. We estimate that a one standard deviation increase in expected longevity increases the probability to comply always with social distancing by 0.6%, to meet people less often by 0.4% and decreases the probability to forgo any medical treatment by 0.6%. Our estimates vary depending on the availability of health care, as well as individuals' gender and pre-existing health conditions. |
| Keywords: | health capital, forgone medical treatment, health behaviours, private information, longevity expectations, SHARE, Europe, instrumental variables, COVID-19 |
| JEL: | I12 I18 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15493&r= |
| By: | Kate Antonovics; Sandra E. Black; Julie Berry Cullen; Akiva Yonah Meiselman |
| Abstract: | Schools often track students to classes based on ability. Proponents of tracking argue it is a low-cost tool to improve learning since instruction is more effective when students are more homogeneous, while opponents argue it exacerbates initial differences in opportunities without strong evidence of efficacy. In fact, little is known about the pervasiveness or determinants of ability tracking in the US. To fill this gap, we use detailed administrative data from Texas to estimate the extent of tracking within schools for grades 4 through 8 over the years 2011-2019. We find substantial tracking; tracking within schools overwhelms any sorting by ability that takes place across schools. The most important determinant of tracking is heterogeneity in student ability, and schools operationalize tracking through the classification of students into categories such as gifted and disabled and curricular differentiation. When we examine how tracking changes in response to educational policies, we see that schools decrease tracking in response to accountability pressures. Finally, when we explore how exposure to tracking correlates with student mobility in the achievement distribution, we find positive effects on high-achieving students with no negative effects on low-achieving students, suggesting that tracking may increase inequality by raising the ceiling. |
| JEL: | H75 I21 I24 I28 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30370&r= |
| By: | Emmanuel Saez; Gabriel Zucman |
| Abstract: | Recent estimates of US top wealth shares obtained by capitalizing income tax returns (Saez and Zucman, 2020; Smith, Zidar and Zwick, 2022) are close in both levels and trends except for the top 0.01% where a large discrepancy remains. We examine this difference and, using public data, quantify three main issues in Smith et al. (2022). First, Securities and Exchange Commission data at the shareholder firm level show that billionaires' equity wealth is underestimated by a factor of 2.1. Second, interest-bearing assets at the top are under-estimated by a factor of 1.6, because of an extrapolation from a small and unrepresentative sample of investment funds. We quantify this issue using mandatory filings of US hedge funds. Third, issues involving tiered partnerships and the measurement of business profits suggest that large S-corporations are undervalued by a factor of 1.2 and top-owned partnerships by up to 2.2. After incorporating these results, the top 0.01% wealth share of Smith et al. (2022) is close to the one found in Saez and Zucman (2020) and estimates of US wealth inequality are reconciled. |
| JEL: | D31 H25 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30396&r= |