Have More or Less
A Choice Mind-Set Increases the Acceptance and Maintenance of Wealth Inequality
Krishna Savani & Aneeta Rattan
Psychological Science, forthcoming
Abstract:
Wealth inequality has significant psychological, physiological, societal, and economic costs. In six experiments, we investigated how seemingly innocuous, culturally pervasive ideas can help maintain and further wealth inequality. Specifically, we tested whether the concept of choice, which is deeply valued in American society, leads Americans to act in ways that perpetuate wealth inequality. Thinking in terms of choice, we argue, activates the belief that life outcomes stem from personal agency, not societal factors, and thereby leads people to justify wealth inequality. The results showed that highlighting the concept of choice makes people less disturbed by facts about existing wealth inequality in the United States, more likely to underestimate the role of societal factors in individuals' successes, less likely to support the redistribution of educational resources, and less likely to support raising taxes on the rich - even if doing so would help resolve a budget deficit crisis. These findings indicate that the culturally valued concept of choice contributes to the maintenance of wealth inequality.
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Insecure Alliances: Risk, Inequality, and Support for the Welfare State
Philipp Rehm, Jacob Hacker & Mark Schlesinger
American Political Science Review, May 2012, Pages 386-406
Abstract:
Popular support for the welfare state varies greatly across nations and policy domains. We argue that these variations - vital to understanding the politics of the welfare state - reflect in part the degree to which economic disadvantage (low income) and economic insecurity (high risk) are correlated. When the disadvantaged and insecure are mostly one and the same, the base of popular support for the welfare state is narrow. When the disadvantaged and insecure represent two distinct groups, popular support is broader and opinion less polarized. We test these predictions both across nations within a single policy area (unemployment insurance) and across policy domains within a single polity (the United States, using a new survey). Results are consistent with our predictions and are robust to myriad controls and specifications. When disadvantage and insecurity are more correlated, the welfare state is more contested.
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Innocent Bystanders? Monetary Policy and Inequality in the U.S.
Olivier Coibion et al.
NBER Working Paper, June 2012
Abstract:
We study the effects and historical contribution of monetary policy shocks to consumption and income inequality in the United States since 1980. Contractionary monetary policy actions systematically increase inequality in labor earnings, total income, consumption and total expenditures. Furthermore, monetary shocks can account for a significant component of the historical cyclical variation in income and consumption inequality. Using detailed micro-level data on income and consumption, we document the different channels via which monetary policy shocks affect inequality, as well as how these channels depend on the nature of the change in monetary policy.
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The Three Worlds of Inequality
Kim Weeden & David Grusky
American Journal of Sociology, May 2012, Pages 1723-1785
Abstract:
Recent inequality scholarship fixates on trends in the amount of inequality and largely ignores trends in the form of inequality. The authors describe three ideal-typical inequality regimes (big-class, microclass, and gradational) and identify the mechanisms driving a shift toward or away from each of them. Using GSS and CPS data on 39 measures of life chances, attitudes, and behaviors, the authors find that big-class inequality is in decline whereas microclass inequality has remained stable. Moreover, big classes are simplifying into largely economic aggregates, whereas microclasses remain more complicated moral configurations that cannot be understood in terms of economic standing.
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Family Background, Self-Confidence and Economic Outcomes
Antonio Filippin & Marco Paccagnella
Economics of Education Review, forthcoming
Abstract:
In this paper we analyze the role played by self-confidence, modeled as beliefs about one's ability, in shaping task choices. We propose a model in which fully rational agents exploit all the available information to update their beliefs using Bayes' rule, eventually learning their true type. We show that when the learning process does not convergence quickly to the true ability level, small differences in initial confidence can result in diverging patterns of human capital accumulation between otherwise identical individuals. If differences in self-confidence are correlated with socio-economic background (as a large body of empirical literature suggests), self-confidence can be a channel through which education and earning inequalities perpetuate across generations. Our theory suggests that cognitive tests should take place as early as possible, in order to avoid that systematic differences in self-confidence among equally talented people lead to the emergence of gaps in the accumulation of human capital.
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Michal Brzezinski
Applied Economics Letters, Winter 2013, Pages 305-311
Abstract:
This article estimates the relationship between income inequality approximated by the top 10% and 1% income shares derived from income tax return data and nine crime categories for the US states between 1979 and 2003. We fail to find a positive relationship between inequality and crime, except for the case of the top 10% share and motor vehicle theft.
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Social Trust: Fairness Matters More Than Homogeneity
Jong-sung You
Political Psychology, forthcoming
Abstract:
This article explores whether homogeneity or fairness better explains generalized interpersonal trust across countries. Although some research suggests that ethnic diversity and income heterogeneity have a negative impact on social trust, I argue that cross-national variations in social trust are better explained by fairness: fair procedural rules (democracy), fair administration of rules (freedom from corruption), and fair income distribution (relatively equal but also unskewed). This expectation is confirmed by a multilevel analysis of data from the World Values Surveys and European Values Study covering 170,000 individuals in 80 countries.
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Does Median Voter Income Matter? The Effects of Inequality and Turnout on Government Spending
Lucy Barnes
Political Studies, forthcoming
Abstract:
This article examines the relationship between economic inequality, electoral turnout and redistributive spending. I use the Current Population Survey to create direct measures of the income of the median voter to investigate its effect on spending and its relationship with inequality and turnout. In the 50 US states from 1978 to 2002, I find little effect of these direct measures on redistributive outcomes; nor do the individual characteristics of the median voter appear to mediate the effects of turnout and inequality measured at the state level. Thus I find no support for the contention that turnout affects government spending via increasing the political representation of the poor. In contrast to cross-national findings, across US states the income of the median voter is not strongly affected by turnout, but rather by other state characteristics.
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Income inequality, tax base and sovereign spreads
Joshua Aizenman & Yothin Jinjarak
NBER Working Paper, June 2012
Abstract:
This paper investigates the association between greater income inequality, de-facto fiscal space, and sovereign spreads. Using data from 50 countries in 2007, 2009 and 2011, we find that higher income inequality is associated with a lower tax base, lower de-facto fiscal space, and higher sovereign spreads. The economic magnitude of these effects is large: at the margin, a one point of the Gini coefficient of inequality (in a scale of 0-100), is associated in 2011 with a lower tax base of 2 percent of the GDP, and with a higher sovereign spread of 45 basis points.
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Optimal minimum wage policy in competitive labor markets
David Lee & Emmanuel Saez
Journal of Public Economics, October 2012, Pages 739-749
Abstract:
This paper provides a theoretical analysis of optimal minimum wage policy in a perfectly competitive labor market and obtains two key results. First, we show that a binding minimum wage - while leading to unemployment - is nevertheless desirable if the government values redistribution toward low wage workers and if unemployment induced by the minimum wage hits the lowest surplus workers first. Importantly, this result remains true in the presence of optimal nonlinear taxes and transfers. In that context, a binding minimum wage enhances the effectiveness of transfers to low-skilled workers as it prevents low-skilled wages from falling through incidence effects. Second, when labor supply responses are along the extensive margin only, which is the empirically relevant case, the co-existence of a minimum wage with a positive tax rate on low-skilled work is always (second-best) Pareto inefficient. A Pareto improving policy consists of reducing the pre-tax minimum wage while keeping constant the post-tax minimum wage by increasing transfers to low-skilled workers, and financing this reform by increasing taxes on higher paid workers. Those results imply that the minimum wage and subsidies for low-skilled workers are complementary policies.
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Govind Iyer & Philip Reckers
Journal of Accounting and Public Policy, May-June 2012, Pages 258-276
Abstract:
Vertical equity is an important criterion in evaluating a tax system. Vertical equity has two elements: progressivity and income equality. In this paper, we analyze the vertical equity effects of the US income tax system during 1995-2006 and show that income inequality increased substantially during the period combined with a significant reduction in real progressivity. Using a Lorenz-curve-based graphical method, we decompose progressivity and income inequality indices and identify and quantify how much each source of income contributes to overall progressivity and income inequality. Results for the 1995-2006 period indicate that US income tax treatment of Salaries and Wages income were distributed and taxed progressively and contributed to a decrease in income inequality. However, the treatment of Net Capital Gains not only decreased progressivity, it negated the income inequality reduction achieved by salaries and wages. These results show that to evaluate the vertical equity of a tax system, both income inequality and progressivity indexes must be considered. Additionally, the decomposition method allows policy makers to estimate the progressivity and income inequality effects of marginal changes in income source and how each source is taxed.
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Ashley Fox
Journal of Biosocial Science, July 2012, Pages 459-480
Abstract:
Although health is generally believed to improve with higher wealth, research on HIV in sub-Saharan Africa has shown otherwise. Whereas researchers and advocates have frequently advanced poverty as a social determinant that can help to explain sub-Saharan Africa's disproportionate burden of HIV infection, recent evidence from population surveys suggests that HIV infection is higher among wealthier individuals. Furthermore, wealthier countries in Africa have experienced the fastest growing epidemics. Some researchers have theorized that inequality in wealth may be more important than absolute wealth in explaining why some countries have higher rates of infection and rapidly increasing epidemics. Studies taking a longitudinal approach have further suggested a dynamic process whereby wealth initially increases risk for HIV acquisition and later becomes protective. Prior studies, conducted exclusively at either the individual or the country level, have neither attempted to disentangle the effects of absolute and relative wealth on HIV infection nor to look simultaneously at different levels of analysis within countries at different stages in their epidemics. The current study used micro-, meso- and macro-level data from Demographic and Health Surveys (DHS) across 170 regions within sixteen countries in sub-Saharan Africa to test the hypothesis that socioeconomic inequality, adjusted for absolute wealth, is associated with greater risk of HIV infection. These analyses reveal that inequality trumps wealth: living in a region with greater inequality in wealth was significantly associated with increased individual risk of HIV infection, net of absolute wealth. The findings also reveal a paradox that supports a dynamic interpretation of epidemic trends: in wealthier regions/countries, individuals with less wealth were more likely to be infected with HIV, whereas in poorer regions/countries, individuals with more wealth were more likely to be infected with HIV. These findings add additional nuance to existing literature on the relationship between HIV and socioeconomic status.
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Veblen effects, political representation, and the reduction in working time over the 20th century
Seung-Yun Oh, Yongjin Park & Samuel Bowles
Journal of Economic Behavior & Organization, July 2012, Pages 218-242
Abstract:
We explain the substantial decline in work hours over the 20th century by the joint influence of the employees' "pecuniary emulation" of the "conspicuous consumption" of top income earners and the balance of political power of employers and employees in the presence of conflicts of interest over the issue of working time. We present a new labor discipline model incorporating Veblen effects in which hours are determined by employers and subject to complete contracts but employee work effort is not. We show that while Veblen effects increase the hours sought by employees, the hours selected by profit-maximizing employers may exceed that preferred by employees, who may then seek to reduce work hours by means of collective bargaining or governmental intervention. We also identify conditions under which employees will prefer longer hours than offered by employers. Using newly available data on top income shares, and on work hours from ten major industrial economies and covering the entire past century we test two hypotheses: that increases in the relative incomes of the very rich are associated with increased hours, while increases in the political representation of workers have the opposite effect. The estimated effects are large in economic magnitude, highly significant and robust to alternative econometric specifications, including country and time fixed effects. Using an alternative data set covering the last third of the past century we show that these results are robust to the inclusion of a measure of taxation and find that decentralized trade union bargaining (but not centralized bargaining) may raise working hours.
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Neural correlates of socioeconomic status in the developing human brain
Kimberly Noble et al.
Developmental Science, July 2012, Pages 516-527
Abstract:
Socioeconomic disparities in childhood are associated with remarkable differences in cognitive and socio-emotional development during a time when dramatic changes are occurring in the brain. Yet, the neurobiological pathways through which socioeconomic status (SES) shapes development remain poorly understood. Behavioral evidence suggests that language, memory, social-emotional processing, and cognitive control exhibit relatively large differences across SES. Here we investigated whether volumetric differences could be observed across SES in several neural regions that support these skills. In a sample of 60 socioeconomically diverse children, highly significant SES differences in regional brain volume were observed in the hippocampus and the amygdala. In addition, SES × age interactions were observed in the left superior temporal gyrus and left inferior frontal gyrus, suggesting increasing SES differences with age in these regions. These results were not explained by differences in gender, race or IQ. Likely mechanisms include differences in the home linguistic environment and exposure to stress, which may serve as targets for intervention at a time of high neural plasticity.
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Voluntary Association Membership and Social Cleavages: A Micro-Macro Link in Generalized Trust
Chan-ung Park & S.V. Subramanian
Social Forces, forthcoming
Abstract:
Generalized trust varies across individuals and countries. Past studies on trust have demonstrated that voluntary association membership, inequality and ethnic homogeneity at country level are important. However, those studies examined either individual-level or country-level factors separately. In this paper, we conceptualized the emergence of generalized trust as a multilevel process in which the effects of individual-level attributes are influenced by social contexts. Using a multilevel modeling approach on World Values Survey in 48 countries, we estimated a cross-level interaction between voluntary association membership at individual level and income inequality and ethnic homogeneity as two types of social cleavages at country level. We found that the positive effect of voluntary association membership decreases with the level of income inequality.
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Societal projection: Beliefs concerning the relationship between development and inequality in China
Yu Xie et al.
Social Science Research, September 2012, Pages 1069-1084
Abstract:
We examine how the relationship between development and inequality at the societal level is perceived and evaluated by ordinary Chinese people. We hypothesize that because the Chinese have recently experienced rapid increases in both economic growth and social inequality, they tend to view economic development as a driving force of social inequality. To address this question, we conducted a social survey in 2006 in six Chinese provinces (n = 4898). The survey data reveal that a large proportion of Chinese people have internalized a causal model in which they project high levels of inequality onto countries they view as more developed and low levels of inequality onto countries they see as less developed. However, results also show that a smaller proportion of Chinese believe in a negative relationship between development and inequality. Hence, the study reveals heterogeneity among ordinary Chinese in their perceptions of the causal relationship between development and inequality. Surprisingly, socioeconomic and demographic characteristics provide no explanatory power in explaining this heterogeneity.
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Poverty, ethnic minorities among the poor, and preferences for redistribution in European regions
Henning Finseraas
Journal of European Social Policy, May 2012, Pages 164-180
Abstract:
In what social contexts are rich people more likely to support government redistribution of income? Motivated by the literature on inequality aversion and the literature on the relationship between ethnic fractionalization and redistribution, the paper examines whether the relationship between own income and redistributive preferences depends on the regional level of poverty and the ethnic composition of the poor. Using data from the European Social Survey, the paper demonstrates that support for redistribution among the rich is lower when the proportion of ethnic minorities among the poor is high. Several possible mechanisms to account for this relationship are examined. The paper finds no support for explanations based on more animosity towards the poor or towards ethnic minorities and no support for explanations based on lower social trust or social capital: instead, rich people are less concerned with downward income mobility when the proportion of minorities among the poor is high.
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Financial reforms and income inequality
Luca Agnello, Sushanta Mallick & Ricardo Sousa
Economics Letters, forthcoming
Abstract:
Using a panel of 62 countries for 1973-2005, we assess the impact of financial reforms on income inequality. We find that removal of policies towards directed credit and excessively high reserve requirements, and improvements in the securities market reduce inequality.
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Income Inequality and Mental Health - Empirical Evidence from Australia
Lucy Bechtel, Grace Lordan & Prasada Rao
Health Economics, June 2012, Pages 4-17
Abstract:
The causal association between absolute income and health is well-established; however, the relationship between income inequality and health is not. The conclusions from the received studies vary across the region or country studied and/or the methodology employed. Using the Household, Income and Labour Dynamics in Australia panel survey, this paper investigates the relationship between mental health and inequality in Australia. A variety of income inequality indices are calculated to test both the income inequality and relative deprivation hypotheses. We find that mental health is only adversely affected by the presence of relative deprivation to a very small degree. In addition, we do not find support for the income inequality hypothesis. Importantly, our results are robust to a number of sensitivity analyses.
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The Impact of Income Inequality on Values and Attitudes
Frederic Pryor
Journal of Socio-Economics, October 2012, Pages 615-622
Abstract:
Scholars in several social science disciplines scholars have argued from their respective disciplinary perspectives that income inequality has a considerable impact on economic and social performance of a nation. This essay investigates the possible impact of income inequality on 290 values and attitudes in forty industrial nations from an economic perspective. The results show that inequality has a significant impact on values and attitudes especially concerning religion and the family.
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Redistribution and the Notion of Social Status
Ennio Bilancini & Leonardo Boncinelli
Journal of Public Economics, October 2012, Pages 651-657
Abstract:
We study the impact of redistributive policies when agents can signal their social status by spending on a conspicuous good. Our focus is on how the shape of the status function - i.e., how social status is computed and evaluated - can affect the equilibrium outcome of the model, and in particular the relationship between inequality and wasteful conspicuous consumption. We find that if status depends in an ordinal way on individuals' relative standing in terms of economic resources, then redistributing resources from the rich to the poor increases social waste because it forces the rich to spend more on conspicuous consumption in order to differentiate themselves from the poor. If, instead, status depends in a cardinal way on individuals' relative standing, then a redistribution of resources in favor of the poor can reduce social waste. This is possible because under cardinal status there is an additional effect: a lesser degree of inequality decreases the value of social status and, hence, reduces the incentives to engage in wasteful social competition. If this second effect is stronger than the first one, then social waste reduces. In this case a Pareto improvement is also possible but it requires, in addition, that the rich save enough on costly signaling to compensate for the losses due to the reduction of economic resources.
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Marius Busemeyer
Journal of European Social Policy, July 2012, Pages 219-240
Abstract:
Scholarly interest in the study of education from the perspective of political science has increased rapidly in the last few years. However, the literature focuses on comparing education politics at the country level, neglecting the analysis of micro-level foundations of education policies in terms of individual preferences and their interaction with macro contexts. This paper provides a first step in addressing this research gap, engaging in a multilevel analysis of survey data for a large number of OECD countries. The core research question is how institutional contexts - in this case socio-economic and educational inequalities - shape the micro-level association between the individual income position and support for education spending. The core finding is that these different dimensions of inequality have different implications at the micro level. Higher levels of socio-economic inequality enhance the conflict between the rich and the poor over public investments in education. By contrast, when access to higher levels of education is effectively restricted, the rich are more likely to support public education spending. This is because higher levels of educational stratification ensure that further public investments in education benefit the rich relatively more than the poor, who in turn become less willing to support this kind of public spending.
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Gareth Hagger-Johnson et al.
Psychosomatic Medicine, forthcoming
Objective: The association between personality traits and mortality might differ as a function of socioeconomic status (SES). Our aim was to evaluate the all-cause, cardiovascular disease (CVD), and cancer mortality risk associated with neuroticism or extraversion and their interactions with SES in a representative sample of the UK adult population.
Methods: A total of 5450 participants (2505 men) from the Health and Lifestyle Survey completed the Eysenck Personality Inventory at baseline and were monitored for vital status over 25 years. SES was defined as a latent variable comprising occupational social class, educational attainment, and income.
Results: A significant neuroticism-by-SES-by-sex interaction (p = .04) for CVD mortality revealed a neuroticism-by-SES interaction specific to women. Compared to women with average SES, those with both high neuroticism and low SES were at an increased risk for CVD mortality (hazard ratio = 2.02, 95% confidence interval = 1.45-2.80), whereas those with high neuroticism and high SES combined were at a decreased risk for CVD mortality (hazard ratio = 0.61, 95% confidence interval = 0.38-0.97, p for interaction = 0.003). The interaction term was not explained by health behaviors (10% attenuation) and physiological variables (11% attenuation). This interaction was not observed for all-cause and cancer mortality risks or among men for CVD mortality.
Conclusions: High neuroticism is a risk factor for cardiovascular mortality in women with low SES, whereas in women with higher SES, it is protective. Further research is needed to replicate this finding and identify the mechanisms behind the modifying effect of SES on neuroticism.
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Gerhard Reese, Anne Berthold & Melanie Steffens
Political Psychology, forthcoming
Abstract:
The relation between developed and developing countries is characterized by inequalities that sometimes hinder actions against worldwide problems. The current research presents an intergroup approach, based on the ingroup projection model, towards an analysis of psychological processes that perpetuate global inequality on a social group level. Precisely, we argue that people from developed countries perceive their group as more prototypical for the world population than they perceive people from developing countries. These perceptions of ingroup prototypicality should in turn relate to legitimacy beliefs and predict unfavorable behavioral intentions towards developing countries. We present two studies that corroborate our hypotheses: In Study 1, participants from a developed country perceived their ingroup as more prototypical for the superordinate group (i.e., world population) than the outgroup (i.e., developing countries), which in turn was related to beliefs that global inequality is legitimate. This finding was replicated in Study 2, and the predicted effect of ingroup prototypicality on behavioral intentions was mediated by legitimacy beliefs. These findings demonstrate that intergroup processes can contribute to perpetuating global inequality.
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Andrew Vonasch & Roy Baumeister
British Journal of Social Psychology, forthcoming
Abstract:
Greater belief in free will is associated with greater empathy towards the working poor, support for social mobility, greater desire for socio-economic equality, and less belief that poor people are fated to live in poverty. We found no sign that belief in free will led to prejudice or discrimination against poor people or undercut justice. These findings from an online survey flatly contradict the claims made by James Miles (2011). Belief in a just world did produce many of the patterns Miles attributed to belief in free will. We also question the reasoning and the strength of the purported evidence in his article, and we recommend that future writers on the topic should cultivate cautious, open-minded consideration of competing views. Miles' article is a useful reminder that to some writers, the topic of free will elicits strong emotional reactions.
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FDI and Income Inequality: Evidence from a Panel of U.S. States
Pandej Chintrakarn, Dierk Herzer & Peter Nunnenkamp
Economic Inquiry, July 2012, Pages 788-801
Abstract:
This study employs state-level panel data to explore the relationship between inward foreign direct investment (FDI) and income inequality in the United States. Using panel cointegration techniques that allow for cross-sectional heterogeneity and cross-sectional dependence, we find that, in the long run, FDI exerts a significant and robust negative effect on income inequality in the United States. This result for the United States as a whole does not imply that FDI narrows income gaps in each individual state. There is considerable heterogeneity in the long-run effects of FDI on income inequality across states, with some states (21 out of 48 cases) exhibiting a positive relationship between FDI in income inequality.
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Income Inequality and Health: Lessons from a Refugee Residential Assignment Program
Hans Grönqvist, Per Johansson & Susan Niknami
Journal of Health Economics, forthcoming
Abstract:
This paper examines the effect of income inequality on health for a group of particularly disadvantaged individuals: refugees. Our analysis draws on longitudinal hospitalization records coupled with a settlement policy where Swedish authorities assigned newly arrived refugees to their first area of residence. The policy was implemented in a way that provides a source of plausibly random variation in initial location. The results reveal no statistically significant effect of income inequality on the risk of being hospitalized. This finding holds also for most population subgroups and when separating between different types of diagnoses. Our estimates are precise enough to rule out large effects of income inequality on health.
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Mauricio Avendano
Social Science & Medicine, August 2012, Pages 754-760
Abstract:
Income inequality is strongly associated with infant mortality across countries, but whether this association is causal has not been established. In their commentary in this issue of Social Science & Medicine, Regidor et al. (in this issue) argue that this association has disappeared in recent years, and question the premise of a causal link. This paper empirically tests the impact of income inequality on infant mortality in a fixed effects model that exploits the evolution of income inequality over a 38-year period, controlling for all time-invariant differences across countries. Data came from the Standardized World Income Inequality Database, containing yearly estimates for the period 1960-2008 in 34 countries member of the Organization for Economic Co-operation and Development (OECD), linked to infant mortality data from the OECD Health database. Infant mortality was modelled as a function of income inequality in a country and year fixed effects model, incorporating controls for changing economic and labour conditions. In a model without country fixed effects, a one-point increase in the Gini coefficient was associated with a 7% increase in the infant mortality rate (Rate ratio[RR] = 1.07, 95% Confidence Interval [CI] 1.04, 1.09). Controlling for differences across countries in a country fixed effects model, however, income inequality was no longer associated with infant mortality (RR = 1.00, 0.98, 1.01). Similar results were obtained when using lagged values of income inequality for up to 15 years, and in models that controlled for changing labour and economic conditions. Findings suggest that in the short-run, changes in income inequality are not associated with changes in infant mortality. A possible interpretation of the discrepancy between cross-country correlations and fixed effects models is that social policies that reduce infant mortality cluster in countries with low income inequality, but their effects do not operate via income. Findings highlight the need to examine the impact of more specific social policies on infant mortality.
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Lindsay Silva et al.
PLoS ONE, May 2012
Objectives: People of low socioeconomic status are shorter than those of high socioeconomic status. The first two years of life being critical for height development, we hypothesized that a low socioeconomic status is associated with a slower linear growth in early childhood. We studied maternal educational level (high, mid-high, mid-low, and low) as a measure of socioeconomic status and its association with repeatedly measured height in children aged 0-2 years, and also examined to what extent known determinants of postnatal growth contribute to this association.
Methods: This study was based on data from 2972 mothers with a Dutch ethnicity, and their children participating in The Generation R Study, a population-based cohort study in Rotterdam, the Netherlands (participation rate 61%). All children were born between April 2002 and January 2006. Height was measured at 2 months (mid-90% range 1.0-3.9), 6 months (mid-90% range 5.6-11.4), 14 months (mid-90% range 13.7-17.9) and 25 months of age (mid-90% range 23.6-29.6).
Results: At 2 months, children in the lowest educational subgroup were shorter than those in the highest (difference: -0.87 cm; 95% CI: -1.16, -0.58). Between 1 and 18 months, they grew faster than their counterparts. By 14 months, children in the lowest educational subgroup were taller than those in the highest (difference at 14 months: 0.40 cm; 95% CI: 0.08,0.72). Adjustment for other determinants of postnatal growth did not explain the taller height. On the contrary, the differences became even larger (difference at 14 months: 0.61 cm; 95% CI: 0.26,0.95; and at 25 months: 1.00 cm; 95% CI: 0.57,1.43)
Conclusions: Compared with children of high socioeconomic status, those of low socioeconomic status show an accelerated linear growth until the 18th month of life, leading to an overcompensation of their initial height deficit. The long-term consequences of these findings remain unclear and require further study.
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Can Households and Welfare States Mitigate Rising Earnings Instability?
Charlotte Bartels & Timm Bönke
Review of Income and Wealth, forthcoming
Abstract:
We compare the evolution of earnings instability in Germany and the United Kingdom, two countries which stand for different types of welfare states. Deploying data from the German Socio-Economic Panel (SOEP) and the British Household Panel Survey (BHPS), we estimate permanent and transitory variances of male income over the period 1984-2009 and 1991-2006, respectively. Studies in this literature generally use individual labor earnings. To uncover the role of welfare state and households in smoothening earnings shocks, we compute different income concepts ranging from gross earnings to net equivalent household income. We find evidence that the overall inequality of earnings in Germany and the United Kingdom has been rising throughout the period due to both higher permanent earnings inequality and higher earnings volatility. However, taking institutions of the welfare state and risk-sharing households into account, we find that the volatility of net household income has remained fairly stable. Furthermore, redistribution and risk insurance provided by the welfare state is more pronounced in Germany than in the United Kingdom.
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Sergio Espuelas
European Review of Economic History, May 2012, Pages 211-232
Abstract:
Using new data on Spain and Portugal 1950-1980, this paper shows that non-democratic governments were less generous in providing social protection and also financed their meager social policy in a less redistributive way. This contradicts recent studies that hold that dictatorships have no significant effect on social policy. The analysis also reveals that, rather than provoking a "race to the bottom" or an increase in social spending, globalization favored the adoption of tax-funded systems instead of systems based on compulsory social security contributions.