Urbanicity Moderates Associations between Family Income and Adolescent Academic Achievement

Research has shown that family income's relations to early childhood achievement is stronger in large inner cities and weaker in less urbanized areas. Research has not yet considered whether links between family income and achievement in adolescence differ across the urban to rural landscape. Using nationally representative data from the Early Childhood Longitudinal Study, Kindergarten Class of 1998–1999 (N ≈ 9,350), this study examines differences in family income's links with eighth‐grade achievement across large urban, small urban, suburban, and rural communities. The point at which income‐achievement links plateau occurs later in the income distribution in less urbanized areas. The magnitude of the association between family income and reading and science skills also differs across the urban‐rural continuum, such that family income has stronger relations to reading and science achievement in urban cities and weaker links in suburban and rural communities.     

Top incomes and human well-being: Evidence from the Gallup World Poll

The share of income held by the top 1 percent in many countries around the world has been rising persistently over the last 30 years. But we continue to know little about the relationship between the rising top income shares and human wellbeing. Using data from 24 countries and years ranging from 2005 to 2013 in the Gallup World Poll and the World Income Database, this study examines the relationship between top income share and different dimensions of subjective wellbeing. The results are mixed, with the negative relationship between top income shares and average life ladder being driven largely by the European sub-sample. For the European countries, we also document evidence that top income is statistically significantly associated with lower average enjoyment and being well-rested yesterday, and higher average stress and sadness yesterday. Overall, our findings suggest that, at least for individuals in Europe, an economic policy that increases national incomes may have significant crowding-out effect on aggregate evaluative wellbeing if it only increases the share of income at the very top of income distribution. More generally, our results highlight the complex relationships between income inequality and subjective wellbeing across different countries.     

From classes to copulas: wages,capital, and top incomes

Public debates about the rise in top income shares often focus on the growing dispersion in earnings, and the soaring pay for top executives and financial-sector employees. But can the change in the marginal distribution of earnings on its own explain the rise in top income shares? Are top executives replacing capital owners in the group of top-income earners, or are we rather witnessing a fusion of top capital and top earnings? This paper proposes an extension of the copula framework and uses it for exploring the changing composition of top incomes. It illustrates that changes in top income shares can easily be decomposed into respective changes in the marginal distributions of labour and capital income and the changing association between the two types of income. An application using tax record data from Norway shows that the association between top labour and capital incomes grew stronger between 1995 and 2005 in the top half of the wage and capital income distribution, though it declined for the top 1% of capital income receivers. A gender decomposition demonstrates that the association of wage and capital incomes at the top is particularly striking for men, whilst women are largely under-represented in the top halves of the two marginal distributions.     

Rurality and Income Inequality in the United States, 1975–2015

Recent events have focused attention on the perceived widening of the economic divide between urban and rural areas, and on the continued rise of national income inequality. We demonstrate that, in fact, the average income gap between urban (metropolitan) and rural (nonmetropolitan) households has not risen over the past 40 years, and makes virtually no contribution to national income inequality. Rising national inequality is driven by rising inequality within both urban and rural America, not by an urban/rural divergence. As is well known, the growing dispersion of household money income is partly driven by rising wage inequality, particularly in urban areas. Less well recognized is the role played by other income sources. We show that a decline in the progressivity of the distribution of social security payments and cash transfers, and an increase in the regressivity of the distribution of retirement incomes, have jointly made a comparably large contribution to rising income inequality. At the same time, the share of income from self-employment has declined, particularly in rural America, and because self-employment income is very unequally distributed, its diminution has retarded the growth of rural inequality. In 2014–15, however, rural inequality increased, cutting the urban/rural inequality gap in half.     

Long-run trends in top income shares: The role of income and population growth

This paper studies the sensitivity of long-run trends in top income shares to differences in top-share measures. While the standard measure fixes a share of the population, we define alternatives that allow variation in both incomes and size of the top group based on defining absolute income thresholds. In an application to United States data, we find that top income share trends over the past century vary somewhat depending on the measure used. Allowing top groups to increase in size after 1980 along with overall economic growth results in a larger increase of top income shares. The historical drops before WWII are sensitive to the choice of income deflator: using GDP inflates interwar top income shares but using CPI deflates them. Altogether, these results recommend using complementary approaches to defining top income groups when measuring long-term top income share trends.

     

Intra-household inequality in transitional Russia

The paper proposes an original strategy for analyzing household sharing of income and satisfaction. Using two different subjective questions from the Russian data RLMS (Russia Longitudinal Monitoring Survey), we assume a correspondence between, first, the perception of income that household members report and their true income sharing, and, second, between their answer to a satisfaction question and their utility. We show that answers given by different members of the household bring pertinent information on income sharing and utility in the household. In particular, we find a significant effect of the female–male wage ratio in reported income perception and satisfaction differentials between household members. Our data covers the transition period (1994–2003) characterized by massive economic and social changes in Russia. We investigate the evolution of intra-household welfare distribution by exploiting the episode of the financial crisis of 1998 to distinguish two periods: pre- and post-crisis. Our empirical strategy consists of applying probit-type models allowing the parameters to change in a discrete manner between two periods and accounting for discrete unobserved heterogeneity.     

Distribution, Inequality and Concentration of Incomeamong Older Immigrants in Canada

While there are many studies on differences in earnings between immigrants and the native‐born or among immigrant groups, they do not consider distribution and concentration of income among immigrants explicitly. These aspects are important for understanding the distribution of economic welfare and consumer behaviour among members and hence are policy relevant. Using the 1991 Census data, the distribution and concentration of incomehave been examined among 15 broad birthplace groups for population aged55 years and over. About 19 per cent of males and 15 per cent of femalesreceive less than half the median income and obtain 5 per cent and 3 per centof the aggregate income respectively. About 30 per cent of males and29 per cent of females receive more than one and half times the medianincome and obtain 61 per cent and 59 per cent of aggregate incomerespectively. About 51 per cent of males and 56 per cent of females whoreceive incomes between half and one and half times the median income aretermed middle‐class and their shares of aggregate income amount to 34 and38 per cent respectively. Although older immigrants aged 55 years and over, as a group, have roughlythe same quartile distribution and concentration of income as theirCanadian‐born counterparts, the birthplace groups differ considerably.Those from the developing regions, that is, the groups that have loweraverage annual incomes, also have more inequitable distribution of incomethan the Canadian‐born or their counterparts from the developed regions. Thus, income distribution is more polarized in populations from developingregions than in populations from developed regions or in the Canadian‐bornpopulation. On average, females receive 45 per cent less income than males, and thereis less polarization of income among them than among males regardless ofthe place of birth. A part of the explanation lies in the receipt of government transfers, whichtend to equalize rather than polarize incomes, and older women derive ahigher proportion of their income from government transfers than older men.     

The impact of macroeconomic conditions on income inequality

This paper analyzes the relationship between macroeconomic factors and the income distribution using data on equivalized disposable household income from the United Kingdom for 1961–99. We argue in favour of fitting a parametric functional form to the income distribution for each year, and then modeling the time series of model parameters in terms of the macroeconomic factors, as this better allows us to take into account non-stationarity in the time series. Estimates from models that relate income distribution parameters to cyclical variables in first differences (to account for non-stationarity) suggest that neither inflation nor unemployment have significant effects on income inequality. Compared to the commonly-used method of modelling the income shares directly, our approach indicates that there was no clear cut relationship between macroeconomic factors and the UK income distribution during the last third of the twentieth century.     

Banking crises in the US: the response of top income shares in a historical perspective

This paper examines the response of income concentration in the US to the occurrence of major systemic banking crises since the beginning of the twentieth century. In doing so, the paper analyzes the shape of the upper income tail as well as the national income shares accruing to different groups within the richest decile. The findings suggest that systemic banking crises reduce income concentration within the top decile of the US pre–tax and transfers income distribution, and more generally, that the effect is highly heterogeneous across different top income groups. While the richest income group loses ground, the lower half of the top decile appears to gain in relative terms. However, evidence suggests that the estimated short-term effect of market forces stemming from banking crises can be relatively small in magnitude and even temporary in nature, as it may be quickly reabsorbed. These findings lend indirect support to the idea that only substantial changes in government policies and institutional frameworks can bring about radical changes in income distribution.     

Increasing health inequality in China: An empirical study with ordinal data

This paper employs a recently introduced method of income-health matrix to study health inequality in China. The method overcomes the problems associated with ordered self-reported health (SRH) responses when the conventional tools of inequality analysis are used. Applying the new method to the China Health and Nutrition Survey (CHNS) data, we find that over the study period of thirteen years, health inequality has increased by more than one hundred percent in spite of the multifold increase in average income. We conclude that the most likely explanations for the recent increase in China’s health inequality are: aging population, worsening income inequality and poverty, division between urban and rural, and environment deterioration.     

Socioeconomic Status and Age: The Effect of Income Sources and Portfolios on U.S. Adult Mortality

Despite the persistent inverse relationship between family income and mortality, no one has examined the effect of distinct income sources or income portfolios on mortality risk. We link the National Health Interview Survey to the Multiple Cause of Death file and use hazard models to examine income-related mortality across four age groups. Income from jobs, self-employment, interest, and dividends each predicts lower mortality at the younger, middle, and early old ages. Diverse income portfolios buffer against mortality risk at all ages, net of the amount of income received. These findings illuminate the various dimensions of income that shape U.S. mortality risks.     

Money management and control in the Indian joint family across generations

Studies of money management and control will have more cross‐cultural relevance if the family context of money across generations is taken into account. The study of money management and control in middle‐income nuclear and joint family households in urban India illustrates the importance of examining money flows within the wider family context because there is a two‐way flow of money beyond the married couple – between parents and adult children, siblings and other members of the extended family. In the three or four generational joint family, control and management at the household level is not necessarily duplicated for the constituent couples. We draw on open‐ended interviews of 40 persons from 27 urban middle‐income households in North India, between November 2007 and January 2008, to show that the male control of money is the dominant pattern. This pattern is linked to the ideology of male dominance that is found among the middle, lower middle and struggling households, particularly in non‐metropolitan households. The upper‐middle‐class households predominantly in metropolitan households show a pattern of joint or independent control. The focus is on the couple's money decisions within the context of the wider family.     

Income Inequality across the Rural-Urban Continuum in the United States, 1970–2016*

The growth in macro-level income inequality in the United States is well established, but less is known about patterns of inequality at subnational scales and how they vary between and within rural and urban localities. Using data from the Decennial Census and American Community Survey, we produce estimates of within-county income inequality from 1970 to 2016 and analyze differences in inequality levels, the persistence of high (low) inequality, and populations' exposure to high (low) inequality across the rural-urban continuum. We find that income inequality has historically been higher in non-metropolitan than metropolitan counties, but inequality levels converged by 2016 due to growing inequality in metropolitan counties. Additionally, levels of inequality were generally persistent within counties over time, except that counties characterized by low inequality in 1970 were unlikely to remain as such in 2016. Third, non-trivial shares of the metropolitan population resided in low-inequality contexts in 1970, but virtually none of the U.S. population resided in such places by 2016. Residence in high-inequality counties is normative in rural and urban America. This statistical analysis provides an updated portrait of income inequality across the rural-urban continuum, and should spur additional research on stratification in rural America during an era of growing inequality.     

One Family, Two Households: Rural to Urban Migration in Kenya

Many households in sub-Saharan Africa allocate their labor resources between rural and urban areas to diversify risks and maximize income. One such strategy would be for a husband in a rural area to migrate to an urban area while his wife and family remain in the rural area without any chance of joining the migrant husband in the urban area. The family maintains a rural home and an urban home. This article explores possible determinants of this type of migration using data from Kenya. Nontrivial findings suggest that such migratory behavior may be motivated by agglomeration effects of household size in the rural area, an increase in remittance by the migrant husband to his rural family, a relatively low education for the husband, and a high urban cost of living.     

Structural adjustment and family policy in Africa: Lessons from Sudan

The economic strategy pursued by a country profoundly influences the well-being of families. This article uses a social accounting model of the Sudanese economy to compare the effects of two alternative development strategies on growth, employment, and income distribution. The first strategy considered is a conventional growth-oriented strategy emphasizing irrigated, export-oriented agriculture and modern, capital-intensive industry; the second one is a traditional agriculture-led development (TALD) strategy focused on enhancing equity and improving family nutrition by expanding food production. The study's findings for Sudan demonstrate that there is no necessary trade-off between growth and equity. The TALD strategy fosters income growth for the most vulnerable families while simultaneously maximizing aggregate growth. It also holds the prospect of enhancing family equity and increasing access to traditional institutions that provide support to families.World BankHer research interests encompass issues related to poverty and inequality in developing countries. She received her Ph.D. from Cornell University.Before joining the World Bank, he was a visiting scholar at the University of Connecticut and acting head of the Department of Econometrics, University of Khartoum, Khartoum, Sudan. His research interests span development economics (growth, poverty, and equity), public finance, and economic transition in Eastern Europe. He received his Ph.D. from the University of Pittsburgh.     

The value of the second income to two-earner families with children

An increasing number and percentage of families in the United States endeavor to improve family income by placing two adults in the paid work force. This study examines the impact of the second earner on family income for 1,624 married-couple families with children, including 871 one-earner and 753 two-earner families. After-tax income is regressed on one- or two-earner status as well as covariates which confound the income-earner relationship for families of various income levels. The actual after-tax income differential of $7,172 is reduced to $6,076 in the regression analysis. Further, income for each family type is estimated by applying the regression coefficients from one-earner households to the characteristics of two-earner households and the regression coefficients from two-earner households to one-earner household characteristics. Actual incomes for two-earner families are found to be higher than those of one-earner families. However, income differences are reduced from 34% higher actual before-tax income to an estimated 14% lower after-tax income. The findings have important implications for families selecting two earners solely for the purpose of increasing after-tax income.This study received funding from the Graduate School Fund at Northern Illinois University. An earlier version of this paper was presented at the Family Economics/Home Management Conference, Indianapolis, IN, June 1987.Mary Pritchard is an Assistant Professor, Department of Human and Family Resources, Northern Illinois University, DeKalb, IL 60115. She received her Ph.D. from Purdue University and includes family economic well-being, family income and expenditures, and spending patterns of adolescents among her research interests.     

Structural adjustment,women, and agriculture in Cameroon

This article assesses the impact of economic structural programs on the agricultural activities of women's groups in Cameroon, and explores women's ways of coping with the reduction in individual and family income and the loss of public services. It examines the role of 25 women's groups in both rural and urban areas of Cameroon's northwest and southwest provinces in a study conducted from April to June 1999. Economic structural adjustment caused a tremendous increase in the workload of women that are farming usually in lots distant from their homes that yield poor returns. Land for food-crop cultivation has become increasingly scarce, and inputs have become substantially unaffordable. Income generated from the sale of crops is inadequate to supply the economic and social needs of the family. Moreover, the burden of their work has increased as they cope with housework, child-care, and food production, in addition to an expanded participation in paid employment. Moreover, women spend longer working hours than men, meeting both household responsibilities and their outside work. Women have devised strategies to cope with this economic crisis, but they need organizations that will support them with the important resources to be able to operate. Rural women seem to be coping better than urban women cope. In extreme cases, some women in urban areas resort to prostitution to cope with life in this crisis setting.     

Establishing Independence in Low‐Income Urban Areas: The Relationship to Adolescent Aggressive Behavior

Although adolescents in poor urban areas often assume independent, adult‐like roles, relatively little is known about the relationship between these roles and other adolescent behaviors. This research examines the association between independent roles occurring within different contexts (e.g. family, peer, work) and aggressive behavior among 516 low‐income, urban middle school students. Overall, adolescent employment is related to increases in aggressive behavior. However, associations that familial and peer independent roles have with aggression differ by the extent of youth involvement in paid work. Greater engagement in familial independent roles is associated with decreased aggression among employed adolescents, but with increased aggression among unemployed youth. Also, peer independent roles are related to significantly greater increases in aggression among unemployed, compared with employed, adolescents.     

The concept and measurement of asset poverty: Levels, trends and composition for the U.S., 1983–2001

American prosperity in the second half of the 1980s together with the booming economy of the 1990s created the impression that American households have done well, particularly in terms of wealth acquisition. In this paper, we develop the concept of “asset poverty” as a measure of economic hardship, distinct from and complementary to the more commonly used concept of “income poverty.” We define a household with insufficient assets to enable it to meet basic needs (as measured by the income poverty line) for a period of three months to be asset poor. The results reveal that in the face of the large growth in overall assets in the U.S. and a fall in standard income poverty over the period from 1983 to 2001, the level of asset poverty increased from 22.4 to 24.5 percent. We also find that asset poverty rates for blacks and Hispanics are over twice those for whites; that asset poverty rates fall monotonically with both age and education; that they are much higher for renters than homeowners; and that by family type they range from a low of 5 percent for elderly couples to 71 percent for female single parents.