How to measure and proxy permanent income: evidence from Germany and the U.S.

Permanent income (PI) is an enduring concept in the social sciences and is highly relevant to the study of inequality. Nevertheless, there has been insufficient progress in measuring PI. We calculate a novel measure of PI with the German Socio-Economic Panel (SOEP) and U.S. Panel Study of Income Dynamics (PSID). Advancing beyond prior approaches, we define PI as the logged average of 20+ years of post-tax and post-transfer (“post-fisc”) real equivalized household income. We then assess how well various household- and individual-based measures of economic resources proxy PI. In both datasets, post-fisc household income is the best proxy. One random year of post-fisc household income explains about half of the variation in PI, and 2–5 years explain the vast majority of the variation. One year of post-fisc HH income even predicts PI better than 20+ years of individual labor market earnings or long-term net worth. By contrast, earnings, wealth, occupation, and class are weaker and less cross-nationally reliable proxies for PI. We also present strategies for proxying PI when HH post-fisc income data are unavailable, and show how post-fisc HH income proxies PI over the life cycle. In sum, we develop a novel approach to PI, systematically assess proxies for PI, and inform the measurement of economic resources more generally.     

Informal Food Production in the Enlarged European Union

How widespread is the production of food in old and new member states of the European Union and what is the social meaning or logic of such activities? We show that growing food is (a) more widespread in former communist countries than in traditional market economies and (b) is predominantly a hobby or recreational activity in affluent countries, but a coping strategy in reaction to experienced difficulties in making ends meet in poorer nations, and especially so in the former communist countries.     

战后德国的男性人口短缺——规模、结构及其影响因素分析

本文对战后德国男性人口短缺的规模、结构及其影响因素进行了认真的分析.研究表明战后德国男性人口短缺非常严重,但随着时间的推移,男性短缺矛盾逐年趋于缓和.究其原因,性别结构因素在其中扮演了绝对重要的角色,但其影响逐年减弱,年龄结构因素的影响有限,而人口规律因素的影响则有所增强.     

The right to be different: Multiculturalism and the racialization of scandinavian welfare politics; The case of Denmark

‘Multiculturalism’ as an influential ideology for structuring ethnic relations has become exposed to increasing critique also in the Scandinavian context. The paper discusses a racialized political debate, legislation, and institutional practices, taking Denmark as the prime example. An increasingly ‘dual welfare’ is becoming legitimized through a hegemonic culturalized language, consistently interpreting ‘the right to be different’ as ‘being different’, and ‘being different’ as being ‘non‐integrated’. In a society where public debate on ethnic and racial discrimination is less than rudimentary, tolerant claims of multiculturalist relativism are effectively turned upside down in the service of neo‐racism, the preachings of which are imperceptibly becoming adopted as the conventional wisdom. This calls for a discussion on ‘politics of recognition’ which brings the debate on the universalism and particularity out of the abstract, while focusing on the vicissitudes of contemporary democracy in a changing welfare state.     

Essentially lexicographic aggregation

In the paper a new approach to lexicography is developed by which in the general framework of ordered blocks with a monotonic basis it is shown that a nontrivial ordering is translation-invariant if and only if it is essentially lexicographic of degree n. Here, the latter means that the ordering can be represented by an ordinary lexicographic ordering in n dimensions. As an application it is shown that a nontrivial social welfare ordering on Euclidean space possesses a useful invariance property (cardinality and non comparability) if and only if the ordering is essentially lexicographic of a strong kind in that it can be obtained from ordinary lexicography by permutation, cutting-off and order reversal with respect to components. This result generalizes the characterization of lexical individual dictatorship obtained by Gevers and d'Aspremont and it provides, within the social welfare approach, a strong version of Arrow's impossibility theorem by not invoking any Pareto principle at all.The author thanks K. Arrow, W. Gaertner, L. Gevers, and two anonymous referees for helpful hints and suggestions.     

The senator’s tale: the development of Bremen’s bourgeoisie in the post-1945 era

Were members of the German bourgeoisie capable of forming the foundation for a new self-understanding of post-1945German society? Or did they prove to be unsuited as agents of Germany’s new beginning? This article seeks to answer these questions by focusing on historical developments in the early phase of the Federal Republic of Germany as reflected in the biography of one prominent representative of the German bourgeoisie. Theodor Spitta, who was born in 1873, was elected in 1911as a senator for life in the government of the Free Hanse City of Bremen. Spitta was an outstanding representative of a generation socialized under the last German Kaiser, a generation which perceived itself as part of a politically liberal Bremen bourgeoisie. He feared the gradual decline, indeed the disintegration of his class. None the less – or perhaps for that very reason – he committed himself to the goal of restoring a regionally specific form of bourgeois life in the city of Bremen. Although Spitta declared a ‘farewell to the bourgeoisie’ in his autobiographical texts, that did not prevent him from actively pursuing the revival of a unique urban-bourgeois ‘spirit’. This spirit was to serve as a tool in promoting Bremen’s central political goal in post-1945Germany: the preservation of the city-state’s unique status within Germany’s federal system.     

The influence of different dimensions of social comparison on performance measure choice and team composition

Empirical research in the economic literature is increasingly addressing the implications of social comparison on incentive contracts by using analytical principal-agent models. Contrary to the existing investigations, which are primarily based on the assumption that individuals exclusively compare monetary income, theories of behavioral science suggest that monetary income and effort represent different dimensions of social comparison, which are weighted individually. Using a LEN framework, the present study focuses on this aspect of social comparisons and discusses how these dimensions and their individual weights affect optimal contract design and contract efficiency. I consider status-seeking agents who compare themselves to each other and differ with regard to their intensity of social preferences and the specific relevance of dimensions. Finally, I draw conclusions for the drafting of contracts with respect to (1) the choice of performance measures and (2) an optimal team composition.     

Verarmungsrisiken nach kritischen Lebensereignissen in Deutschland und den USA

We study how the impact of job loss, sickness, retirement, and family dissolution on the risk of relative income poverty differs between Germany and the United States, and whether the impact of these events has changed between 1980 and 2009. Americans are more likely than Germans to enter poverty after any of the four events, yet they also recover more quickly from job loss and family dissolution. Comparisons over time do not indicate a secular rise in the impact of critical life events on poverty risks, but our results show that poverty trajectories are subject to stronger cyclical fluctuations in the United States: Through its emphasis on market mechanisms, the liberal American welfare state raises the importance of (re-)employment opportunities for coping with the consequences of adverse life events. The absence of clear long-term trends leads to a reassessment of common views about welfare state change such as Jacob Hacker??s thesis of a ??Great Risk Shift?? or the notion of an ??Americanization?? of Continental European welfare states. So far, there is also little evidence that the often claimed recalibration of welfare states towards ??new social risks?? has alleviated the adverse economic consequences of family dissolution.     

Sustainable development and ecological modernization – the limits to a hegemonic policy knowledge

The implementation problems of effective global environmental politics have essentially to do with the fact that approaches to and the knowledge about sustainability remain sectoralized. There is a gap between the dominant or even hegemonic forms of environmental policy knowledge which are embodied in the concept of sustainable development, on the one hand, and the socially dominant forms of environmental knowledge concerning the appropriation of nature on the other. Until now, the policy knowledge of sustainable development has not been able to question the main assumptions and to shape existing practices of dominant forms of the appropriation of nature. This is shown along five crucial dimensions; of particular importance is the existence of the so-called valorization paradigm. Theoretically, the article is informed by the theory of societal relationships with nature and it focuses on the role of knowledge in social reproduction, innovation, and transformation.