Wages of regular and irregular workers, the price of education, and income inequality

In this paper, we develop a model characterized by skill-biased technological change and increasing costs of education to investigate income inequality. Irregular workers cannot escape poverty by commencing investment in education because wage inequality between regular and irregular workers widens and the price of education increases with the average level of education. Moreover, if the productivity of elementary education is low relative to that of higher education, middle-income individuals are eventually unable to pursue higher education because the threshold for education expenditure rises with the price of education. Thus, income inequality may widen, even among regular workers.     

The effect on inequality of changing one or two incomes

We examine the effect on inequality of increasing one income, and show that for two wide classes of indices a benchmark income level or position exists, dividing upper from lower incomes, such that if a lower income is raised, inequality falls, and if an upper income is raised, inequality rises. We provide a condition on the inequality orderings implicit in two inequality indices under which the one has a lower benchmark than the other for all unequal income distributions. We go on to examine the effect on the same indices of simultaneously increasing one income and decreasing another higher up the distribution, deriving results which quantify the extent of the ‘bucket leak’ which can be tolerated without negating the beneficial inequality effect of the transfer. Our results have implications for the inequality and poverty impacts of different income growth patterns, and of redistributive programmes, leaky or not, which are briefly discussed.     

Why Is Inflation Low When Productivity Growth Is High?

Inflation has been low when productivity growth has been high. This occurs because the Federal Reserve has not adjusted nominal income growth in response to changes in productivity growth, implying that an acceleration in trend productivity growth leads to a deceleration in inflation. The model's predictions are confirmed: (1) Inflation should fall when trend productivity growth rises, and (2) nominal income and wage growth should not change with trend productivity. The model also implies that productivity growth enters a Phillips curve relationship as a proxy for inflation expectations. Thus, estimates of the NAIRU should fall when productivity growth accelerates.     

Equality and Inequality in Modern Society, or Social Stratification Revisited

This paper attempts both to "bring up to date" the author's conception of social stratification as set forth in two previous general papers written in 1940 and 1953, and to broaden the field of consideration by giving special attention to the forces pressing toward equality in various respects, as well as the bases of inequality. The position taken is that the erosion of the legitimacy of the traditional bases of inequality has brought to a new level of prominence value-commitment to an essential equality of status of all members of modern societal communities.
Inequalities, among units of societal structure which are essential in such fields as economic productivity, authority and power, and culturally based competence, must be justified in terms of their contribution to societal functioning. The balancing of the respects in which all members of the societal community and many of its collective subunits must be held to be equal with the imperatives of inequality constitutes one of the primary foci of the problem of integration in modern society. A few suggestions about the mechanisms by which this integrative process can operate are presented.     

THE EVOLUTION OF THE SCIENTIFIC PRODUCTIVITY OF HIGHLY PRODUCTIVE ECONOMISTS

This paper studies the evolution of research productivity of a sample of economists working in the best 81 departments in the world in 2007. The main novelty is that, in so far as a productivity distribution can be identified with an income distribution, we measure productivity mobility in a dynamic context using an indicator inspired in an income mobility index suggested by Fields (2010) for a two‐period world. Productivity is measured in terms of publications, weighted by the citation impact of the journals where each article is published in the periodical literature. We study the evolution of average productivity, productivity inequality, the extent of rank reversals, and productivity mobility for seven cohorts, as well as the population as a whole. We offer new evidence confirming previous results about the heterogeneity of the evolution of productivity for top and other researchers. However, the major result is that—contrary to what was expected—for our sample of very highly productive scholars the effect of rank reversals between the two periods on overall productivity mobility offsets the effect of an increase in productivity inequality from the first to the second period in the youngest five out of seven cohorts. (JEL A11, A12, B41, D63, I32)     

A New Kuznetsian Dynamic: The Knowledge Economy and Income Inequality in the United States, 1917–2008

The rise of the knowledge economy resulted in higher levels of income inequality in the United States and forced many to question the Kuznets Inverted‐U hypothesis. However, this study argues that the establishment of a knowledge economy does not negate the importance of employment shifts for income inequality. Instead, the expansion of knowledge employment alters the major sectors that are responsible for the overall distribution of income. To this end, this article presents the key argument that the current service–knowledge transition impacts income inequality trends, of today, in a way that is similar to the agricultural–industrial transition, of the past. According to the autoregressive conditional heteroskedasticity regressions, the agricultural–industrial transition returns stronger associations with income inequality in the United States before 1950. The agricultural–industrial transition's impact diminishes thereafter as the service–knowledge transition shares a more robust association with income inequality after 1980.     

BETWEEN SCYLLA AND CHARYBDIS: INCOME DISTRIBUTION,CONSUMER CREDIT,AND BUSINESS CYCLES

We introduce a macroeconomic model with heterogeneous households and an aggregate banking sector in order to analyze the impact of rising income inequality under different credit scenarios. Growing inequality produces debt‐led consumption boom dynamics when the banking sector is characterized by a lower capital requirement and a higher willingness to lend. Instead, when inequality rises but the banking sector is highly regulated, aggregate demand and output fall. Our results also yield new insights on the appropriate fiscal policy reaction to stabilize the economy: acting on the progressivity of the tax system seems more effective than a proactive countercyclical fiscal policy. (JEL C63, D31, E62, G01)     

Seeing the system: Systemic gender knowledge to support transformational change towards gender equality in science

Scholars agree that gender inequality is systemic and that participants in gender equality interventions need knowledge on gender inequality processes. However, a detailed view on the specific characteristics of this knowledge is as yet missing. This article aims to contribute to gender equality interventions by conceptualizing and visualizing systemic gender knowledge as an important condition for transformational change. Combining gender and participatory system dynamics literature, this article first introduces the concept of systemic gender knowledge. This concept captures two main characteristics that make gender knowledge systemic: knowledge on the interaction of gender inequality processes and endogenous thinking, here implying a focus on the organization as the relevant level of analysis. In addition to this conceptual contribution, the research contributes methodologically to the gender inequality intervention literature by designing a visualization process, translating written texts into system dynamics models which enable exploration of systemic gender knowledge. Finally, the research contributes empirically by exploring the systemic gender knowledge of participants in two science research institutes of a Dutch university, finding shifts in both characteristics of systemic gender knowledge. This enables researchers to discern whether gender equality interventions lead to increases in systemic gender knowledge, thus supporting transformational change.     

And … action? Gender,knowledge and inequalities in the UK screen industries

This article explores how a knowledge ecology framework can help us better understand the production of gender knowledge, especially in relation to improving gender equality. Drawing on Law, Ruppert, and Savage, it analyses what knowledge of gender inequality is made visible and actionable in the case of the UK screen sector. We show: (i) that the gender knowledge production for the UK screen sector operated with reductionist understandings of gender and gender inequality, and presented gender inequality as something that needed evidencing rather than changing; and (ii) that gender knowledge was circulated in two relatively distinct circuits, a policy‐ and practice‐facing one focused on workforce statistics and a more heterogeneous and critical academic one. We then discuss which aspects of gender inequality in the UK screen industry remained invisible and thus less actionable. The article concludes with a critical appreciation of how the knowledge ecology framework might help better understand gender knowledge production, in relation to social change in the UK screen sector and beyond.     

Survey nonresponse and the distribution of income

The paper examines the distributional implications of selective compliance in sample surveys, whereby households with different incomes are not equally likely to participate. Poverty and inequality measurement implications are discussed for monotonically decreasing and inverted-U compliance-income relationships. We demonstrate that the latent income effect on the probability of compliance can be estimated from information on response rates across geographic areas. On implementing the method on the Current Population Survey for the U.S. we find that the compliance probability falls monotonically as income rises. Correcting for nonresponse appreciably increases mean income and inequality, but has only a small impact on poverty incidence up to poverty lines common in the U.S. Martin Ravallion: Corresponding author.     

The influence of earnings on income distribution in the United States

This article discusses whether the so called “skill-biased technological change” hypothesis is able to explain the individual earnings inequality in the U.S. during the period 1968–2000. Using the statistic information supplied by the Census Bureau and the Bureau of Labor Statistics, the article analyzes the earnings evolution, explaining the reasons why earnings inequality has increased, and the relation of this increase with the household income distribution. The main conclusions are the following: (a) changes on labor productivity are not the main cause of the increase in earnings’ inequality, and (b) this earnings’ inequality is not the only reason for the increase of the households’ income inequality.     

The effect of education,income inequality and merit on inequality acceptance

A large number of observational and experimental studies have explored the determinants of individual preferences for redistribution. In general, inequalities are more likely to be accepted by people of higher socioeconomic status, in richer societies and when inequalities are perceived as justifiable owing to differences in productivity. Almås et al. (2020) show that in a relatively unequal society (the United States), the highly educated accept inequality significantly more than the less educated, whereas, in a relatively equal society (Norway), the less educated accept inequality more, but not significantly more, than the highly educated. Here, we replicate this finding using data from experiments conducted in four locations across three countries all distinct from the ones studied by Almås et al. However, a closer look at the data indicates that the origin of the interaction effect varies depending on which societies one compares. Data for Norway and the United States indicate that meritocratic values among the highly educated are less prevalent in more equal societies and that this is the driver of the triple interaction effect. In contrast, in our data the interaction effects have multiple drivers.     

The Effect of World Economy on Income Inequality: A Reassessment*

The research on the world systems model of income distribution has been marked by some conflicting reports on whether or not periphery status is significantly related to inequality. Writers such as Rubinson argue for the salience of the world-systems model, while authors such as Weede claim that it is insignificant if we include a correctly specified control for level of development. This confusion is based, in part, on a debate over how periphery status should be measured. Previous work has often used measures of questionable validity, such as foreign trade, as a percent of GDP. The present investigation develops a conceptualization of dependency on the world market based on the concentration of export receiving nations. A multiple regression analysis of data from forty-three nations indicates that the index of periphery status does influence indicators of inequality. However, the parabolic model of level of development tends to explain more of the variance in inequality than the world-systems factor. Finally, a control for political democracy gave no support for the political paradigm on inequality.     

Geographic decomposition of inequality in health and wealth: evidence from Cambodia

Applying the small-area estimation methods to Cambodia data, we decompose the total inequality in wealth (consumption) and health (child undernutrition) indicators into within-location and between-location components. Because the knowledge of the pattern of spatial disparity in poverty and undernutrition is important for the geographic targeting of resources, we conduct a geographic decomposition of the variance of the Foster-Greere-Thorbecke index in addition to the standard decomposition exercise based on the generalized entropy measures. We find that a sizable proportion of wealth inequality is due to between-location inequality, whereas health inequality is mainly due to within-location inequality.     

Status Inequality and Close Relationships: An Integrative Typology of Bond-Saving Strategies

Equality is described in the literature as a prerequisite to satisfying close relations, but research has not seriously grappled with how a sense of equality is created or how inequalities might be overcome. This paper uses an interactionist perspective to explore how individuals maintain or repair a close social bond when a perceived difference in status is defined to be problematic. In 7 76 essays, respondents described a situation where a status inequality disrupted a close relationship, the strategies one or both of the participants used to maintain the bond, and how effective the strategies were. Analytic induction yielded four basic strategy types: (a) accept the status inequality; (b) avoid the situation which fosters feelings of inequality; (c) alter the inequality by redefining or concretely mitigating it; and (d) acknowledge and discuss the problematic situation. Findings from previous research on facework, embarrassment, and shame are integrated into this typology, and implications are drawn for symbolic interactionist theory and research.     

Inequality of opportunity in adult health in Colombia

This paper measures inequality of opportunity in adult health in Colombia using the 2010 Living Standards and Social Mobility Survey, a rich dataset that provides unique information about individual childhood circumstances in that country. Dissimilarity and Gini-opportunity indexes are calculated to provide different measures of inequality of opportunity using a self-reported variable for health status. The Shapley-value decomposition is then used to estimate the contribution of early-life circumstances such as parental background, region of origin and ethnicity to inequality of opportunity. The findings suggest that 8 % to 10 % of the circumstance-driven opportunities distinctively enjoyed by those who are healthier should be redistributed or otherwise compensated in order to achieve equality of opportunity. Differences in household socio-economic status during childhood and parental educational attainment appear to be the most salient dimensions of inequality of opportunity in adult health.     

Rebuilding Status Consistency in a Post-communist Society. The Czech Republic, 199197

In this paper we perform an empirical analysis of status consistency in a postcommunist society. We supply three arguments as to why the various dimensions of social status can be expected to have crystallized following the fall of communism. First, post-communist societies have experienced a significant increase in income and wealth inequality. Second, there have been significant changes in the class structure and, third, processes that generate inequality and social structure have been changing as well. The analysis demonstrates the increase in status consistency in the Czech Republic in the period 1991-97. Further, we explore the degree of status inconsistency in different subpopulations and the political consequences of status inconsistency.     

THE DECOMPOSITION OF INEQUALITY BY CLASS AND BY OCCUPATION:

Sociological research on earnings and income has focused on predicting individual income. Analyses most often use occupational status or class, along with other economically relevant variables, to explain earnings or income variations among individuals (income determination). Aggregate inequality (income distribution) has received considerably less attention, except in cross-national research. This especially holds for applying central concepts of stratification to the analysis of inequality. That is, class and occupation differences in economic rewards are rarely used to investigate aggregate earnings or income inequality. This study, using 1976 and 1977 Panel Study of Income Dynamics survey data, estimates the proportion of total earnings/income inequality accounted for by class and by occupation. Theil's index is used to measure earnings and income inequality and thus decompose total inequality into between-and within-group components. Wright's five-category schema is replicated for decomposition of inequality by class and a traditional four-category ordinal typology for decomposition by occupation. The two schemas show similar results: both class and occupation respectively account for between one-fifth and one-fourth of total earnings and income inequality. The results show the relevance of these central stratification typologies for the analysis of aggregate inequality.     

Income Inequality and Opioid Prescribing Rates: Exploring Rural/Urban Differences in Pathways via Residential Stability and Social Isolation

While opioid prescribing rates have drawn researchers' attention, little is known about the mechanisms through which income inequality affects opioid prescribing rates and even less focuses on whether there is a rural/urban difference in mediating pathways. Applying mediation analysis techniques to a unique ZIP code level dataset from several sources maintained by the Centers for Medicare and Medicaid Services, we explicitly examine two mechanisms through residential stability and social isolation by rural/urban status and find that (1) income inequality is not directly related to opioid prescribing rates, but it exerts its influence on opioid prescribing via poor residential stability and elevated social isolation; (2) social isolation accounts for two‐thirds of the mediating effect of income inequality on opioid prescribing rates among urban ZIP codes, but the proportion halves among rural ZIP codes; (3) residential stability plays a larger role in understanding how income inequality matters in rural than in urban ZIP codes; and (4) beneficiary characteristics only matter in urban ZIP codes. These findings offer nuanced insight into how income inequality affects opioid prescribing rates and suggests that the determinants of opioid prescribing rates vary by rural/urban status. Future research may benefit from identifying place‐specific factors for opioid prescribing rates.     

Dynamics of earnings inequality among female-headed households in the United States

The labor market in the United States has gone through a number of noticeable changes, one of which is a rise participation of women in the labor force. A number of studies have investigated the consequences of these changes on wage, income, or earnings inequality in a static framework. This study investigated the consequences of these changes on earnings inequality over time. The earnings inequality among male- and female-headed households is compared. I further considered the factors that might have influenced the earnings inequality among female-headed households. Short-term and long-term inequality was measured from 1978–1986. It was found that short-term inequalities generally have a rising trend and contain transitory components; long-term inequalities declined in the early years because of a smoothing of transitory components; and within-group inequalities are the principle determinant of overall inequality. Education, race, age, and marital status were considered as possible contributors to the overall inequality. Education and race were shown to be the most influential factor explaining inequality among female-headed households and explained a third of the observed inequality. Earnings stability profiles reveal the existence of permanent and chronic inequality.