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Income Distribution
A Category Archive (172 entries)
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November 19, 2009
Economics of Health Care
Arnold Kling
Sherry Glied, Ashwin Prabhu, and Norman Edelman do not think so. The value of physicians' underlying human capital is estimated by forecasting an age-earnings profile for doctors based on the characteristics in youth of NLSY cohort participants who subsequently became... MORE
November 13, 2009
Fiscal Policy
Arnold Kling
A reader recommends a paper by Laurence J. Kotlikoff and David Rapson. The reader views this paper as contradicting the article I linked to earlier. Kotlikoff and Rapson report marginal tax rates of closer to 40 percent than 100 percent... MORE
November 11, 2009
Income Distribution
Arnold Kling
Clifford F. Thies writes, When you take into account the loss of means-tested benefits (e.g., cash assistance, food stamps, housing subsidies, and health insurance), and the taxes that people pay on earned income, the return to working is essentially zero... MORE
October 5, 2009
Income Distribution
David Henderson
In his New York Times column this morning, Ross Douthat considers various ways of reducing income inequality. While not endorsing higher taxes on high-income people, Douthat's takes it as given that such taxes would reduce inequality. Ignore the fact that... MORE
July 31, 2009
Income Distribution
David Henderson
I was waiting for others to take up John Goodman's June 12 challenge, but I think I've waited long enough. Goodman mentioned Neil Wanless, who won a $200+-million jackpot in a lottery. Statists, both economists and non-economists, often argue against... MORE
July 14, 2009
Income Distribution
Arnold Kling
As part of a long, interesting essay, He writes, You can see leveling in quality across the price scale in almost every kind of consumer good.19 At the turn of the 20th century, only the mega-rich had refrigerators or cars.... MORE
May 16, 2009
Income Distribution
David Henderson
Last week, I highlighted parts of my favorite Paul Krugman book, Pop Internationalism. Here's another of my favorite quotes from Krugman. I used it in a sidebar for the Frank Levy article, "Distribution of Income," in the first edition of... MORE
Income Distribution
Bryan Caplan
Once you're familiar with the literature on the intergenerational income correlation, it's easy to be complacent. But isn't there any unfairness left to get upset about? Absolutely. The catch: Government, not "capitalism," is clearly to blame.Yes, income difference inside Western... MORE
May 15, 2009
Income Distribution
Bryan Caplan
Children resemble their parents. When the resemblance is physical, we usually think it's funny or cute. But when the resemblance is financial, it's an Issue. Non-economists debate the merits of the cynic's maxim that, "It's not what you know, it's... MORE
April 28, 2009
Income Distribution
Arnold Kling
Tara Watson has a paper that sounds interesting, based on the abstract. American metropolitan areas have experienced rising residential segregation by income since 1970. One potential explanation for this change is growing income inequality. However, measures of residential sorting are... MORE
April 27, 2009
Cross-country Comparisons
David Henderson
In his column in yesterday's New York Times, Cornell University economist Robert Frank writes: Another important message of recent research is that a person's salary depends far more on where she is born than on her talent and effort. For... MORE
April 25, 2009
Income Distribution
David Henderson
Berkeley economist Emmanual Saez has won the 2009 John Bates Clark Medal, awarded bi-annually by the American Economic Association since 1947 to "that American economist under the age of forty who is judged to have made the most significant contribution... MORE
April 24, 2009
Behavioral Economics and Rationality
David Henderson
"I'll be miserable for five years as long as you make me wealthy." I've always been a fan of Richard Epstein's thinking. I hadn't known, however, that he had thoughts on the "happiness" literature. I learned a lot about much... MORE
March 23, 2009
Income Distribution
David Henderson
I think the average quality of letters to the Wall Street Journal is medium to low, but today's lead letter is quite good. The author writes to elaborate on a point made by Daniel Henninger in a column that I... MORE
March 9, 2009
Income Distribution
Bryan Caplan
Behavioral geneticists will tell you that intelligence and personality are highly heritable. But at least for economists, intelligence and personality are mainly interesting insofar as they predict that variable that "really" counts - income. How heritable is that?Quite. This 2002... MORE
March 5, 2009
Economics of Education
Arnold Kling
Theda Skocpol and Suzanne Mettler write (free but awkward registration required), in 1970, 6.2 percent of the U.S. population in the bottom income quartile had completed a baccalaureate degree by age 24-and that percentage actually declined slightly, to 6 percent,... MORE
February 10, 2009
Income Distribution
Arnold Kling
Brink Lindsey has written a paper criticizing Paul Krugman's view that the period from 1950-1970 was a sort of golden era for economic policy, because it involved high economic growth with relatively little inequality. Lindsey instead sees the immediate postwar... MORE
February 1, 2009
Fiscal Policy
Arnold Kling
Hall and Woodward write, One problem with the employment stimulus is that the funds go in the first instance to the owners of businesses and not to consumers generally. This criticism applies to my preferred stimulus, which is to take... MORE
January 5, 2009
Economics of Health Care
David Henderson
Do you think the government should forcibly reduce income inequality using taxes and subsidies? If so, wouldn't it follow that the government should forcibly reduce inequality in life spans? No? Then, if you answered Yes to the first question, you... MORE
October 2, 2008
Income Distribution
Arnold Kling
Nick Schulz and I write, It might seem natural to pin the blame for the disappointing rate of high school graduation and college training on America's education system. However, Heckman and others find little evidence that education can reduce differences... MORE
September 26, 2008
Income Distribution
Arnold Kling
Maybe some distressed borrowers should have known better, and maybe some were innocent victims. I think it's impossible to generalize. I think that whether an individual home owner or home borrower was a victim is something that ought to be... MORE
August 27, 2008
Income Distribution
Arnold Kling
I beg to differ with PGL, Martin Feldstein, and Steve Pearlstein. First, PGL: Gee – the [Social Security] Trust Fund will have $5 trillion in bonds earning interest. What that means is that over the past decades, Social Security has,... MORE
August 21, 2008
Income Distribution
Arnold Kling
In a previous post, I questioned the narrative that says that you can describe the past three decades of economic change as resulting from a wave of deregulation. Instead, here are a list of drivers that I think played a... MORE
July 25, 2008
Income Distribution
Arnold Kling
At GNXP, Herrick writes let's just go all the way to perfect heritability of IQ and perfect assortive mating on IQ. In other words, let's see if "IQ clones" will be have enough similarity in wages to match the 0.4... MORE
July 14, 2008
Income Distribution
Arnold Kling
The professor who taught my international trade course back in graduate school writes, what CSR (corporate social responsibility) does is to extend the traditional practice of the Burghers-Jains-Calvinists -- where families that made the moneys spent them directly on social... MORE
July 10, 2008
Economics of Education
Arnold Kling
On p. 96 of their new book, Claudia Goldin and Lawrence F. Katz provide a table on the composition of the U.S. labor force in terms of educational background, based on historical census data. The percentage of high school graduates... MORE
July 2, 2008
Human Capital: Returns to entrepreneurs, skills, etc.
Arnold Kling
I have ordered their new book, after seeing it mentioned in David Leonhardt's column in the New York Times. An excerpt from the book is here. For cohorts born from the 1870s to about 1950, every decade was accompanied by... MORE
July 1, 2008
Income Distribution
Arnold Kling
Brad DeLong writes, The true history of the U.S. since 1980, IMHO at least, is not Sean Wilentz's "Age of Reagan" but is instead composed of a half dozen or so deeper and broader tides, like: 1. The end of... MORE
June 19, 2008
Income Distribution
Arnold Kling
Ian Dew-Becker and Robert J. Gordon write, Only the top 10% of US earners have seen their incomes grow faster than productivity since 1966. Part of the top-earner income growth is driven by market forces (superstar economics); the only feasible... MORE
June 16, 2008
Income Distribution
Arnold Kling
James Heckman writes, Family environments of young children are major predictors of cognitive and socioemotional abilities, as well as a variety of outcomes such as crime and health. ...Family environments in the U.S. and many other countries around the world... MORE
June 13, 2008
Income Distribution
Arnold Kling
Income distribution, education, health care, and oil prices. David Henderson rushes in where few right-of-center economists dare to tread. He talks about the income distribution. The average number of earners per family for the top quintile is 2.16, almost three... MORE
June 5, 2008
Business Economics
Arnold Kling
Another Nassim Nicholas Taleb quote: A scalable profession is good only if you are successful; they are more competitive, produce monstrous inequalities, and are far more random, with huge disparities between efforts and rewards--a few can take a large share... MORE
May 28, 2008
Income Distribution
Arnold Kling
Anne Case, Christina Paxson, and Mahnaz Islam say that the wage premium reflects cognitive ability. [____] is significantly associated with greater educational attainment, and selection into higher skill occupations – both of which confer higher earnings capacity. They argue that... MORE
May 13, 2008
Income Distribution
Arnold Kling
He speaks on this video. He is a very powerful speaker. One theme of the talk is the importance of really creative people to the economy. This may be a valid form of elitism, although I'd like to leaven his... MORE
April 25, 2008
Income Distribution
Arnold Kling
In his new book Unequal Democracy, Larry Bartels writes (p.7), families at the 20th percentile experienced declining real incomes in 20 of the 58 years...by comparison, families at the 95th percentile have experienced only one decline of 3% or more... MORE
April 23, 2008
Income Distribution
Arnold Kling
In the latest econtalk, Russ Roberts just speaks himself. The result may be my favorite of all of his podcasts. If you had just one hour to learn essential, basic economics, listening to this talk would be the way to... MORE
April 7, 2008
Income Distribution
Arnold Kling
From a longer essay on Inequality and Excess: I feel awkward and defensive when the subject of economic inequality comes up. The fact is that I cannot say that I feel comfortable with the levels of inequality and excess that... MORE
March 26, 2008
Economics of Education
Arnold Kling
I am going to combine comments on two papers cited by Tyler Cowen. First, he cites a paper on inequality and mobility. It argues that skill differentials are widening, and that parental education seems to be increasingly important. (Note that... MORE
February 25, 2008
Income Distribution
Arnold Kling
Lane Kenworthy writes, The most striking of the report’s findings is how little of the federal government’s mobility expenditure goes to those with low incomes. This chart shows the estimated amounts that go to lower-income households (bottom two quintiles of... MORE
Income Distribution
Arnold Kling
This week's econtalk conversation, between Russ Roberts and Thomas Sowell, is not to be missed. My favorite nugget is when Sowell describes the professional progress women made early in the 20th century, because the age of marriage and childbearing was... MORE
February 13, 2008
Income Distribution
Arnold Kling
Bruce D. Meyer and James X. Sullivan write, The bottom deciles of consumption exceed those for income, suggesting under-reporting of income. There is a high and rising under-reporting rate for government transfers, a source of income that is particularly important... MORE
February 8, 2008
Income Distribution
Arnold Kling
Jeff Frankel quotes Jeff Liebman: "There are some excellent papers that carefully model how the cumulative effects of the welfare system create a poverty trap. But I don’t think either of these papers includes all of the factors facing the... MORE
January 8, 2008
Economic Education
Arnold Kling
Professor Donald Lacombe of Ohio University is offering a course in Econoblogging! Will this test Tyler's assertion that the best way to learn economics nowadays is through blogs? In addition to blogs, a venerable source of economic wisdom is the... MORE
November 27, 2007
Income Distribution
Arnold Kling
Herb Gintis writes, if the wealth were redistributed to the middle class, the US investment rate would fall, since the rich save their money and it is translated into investment, whereas the middle classes would spend their gains on consumption,... MORE
November 13, 2007
Income Distribution
Arnold Kling
A Wall Street Journal editorial reports, The Treasury study examined a huge sample of 96,700 income tax returns from 1996 and 2005 for Americans over the age of 25. The study tracks what happened to these tax filers over this... MORE
November 7, 2007
Income Distribution
Arnold Kling
Claudia Goldin and Lawrence Katz write, Relative demand shifts favoring more-educated workers have not been particularly rapid since 1980. Instead, the growth of the supply of skills slowed considerably after 1980 and the wage structure, in consequence, widened. The deceleration... MORE
November 6, 2007
Economics of Health Care
Arnold Kling
Greg Mankiw writes, Almost all sweeping health reform proposals involve higher taxes on the rich to provide benefits for those farther down the economic ladder. The redistribution, rather than health reform, is sometimes the main objective. To judge whether my... MORE
October 31, 2007
Income Distribution
Arnold Kling
Walter Williams writes, There's one segment of the black population that suffers only a 9.9 percent poverty rate, and only 13.7 percent of their under-5-year-olds are poor. There's another segment of the black population that suffers a 39.5 percent poverty... MORE
October 30, 2007
Income Distribution
Arnold Kling
Ricardo Hausmann sees the silver lining. According to the latest gender related statistics published in the 2007 World Development Indicators (WDI) by the World Bank, the gaps between the sexes are going through a major shift worldwide. In 2006, literacy... MORE
October 24, 2007
Income Distribution
Arnold Kling
Terry J. Fitzgerald in the Minneapolis Fed Review: Fringe benefits have become an increasingly important part of employee compensation over the past 30 years. The BLS estimates that benefits currently account for about 30 percent of employer costs for employee... MORE
October 18, 2007
Income Distribution
Arnold Kling
Some recent posts on the inequality fuss: 1. Greg Mankiw writes If I were a redistributionist, here is what I might propose: A large fixed payment to every citizen, paid at the beginning of every month, financed by a proportional... MORE
September 13, 2007
Income Distribution
Bryan Caplan
This story from The Onion gets funnier once you realize that - by world standards - the "American poor" are rich. P.S. Here's more economic insight from America's finest news source. HT: Mankiw.... MORE
August 8, 2007
Income Distribution
Arnold Kling
Todd Zywicki writes, In turns out that for the 1970s family, paying 24% of its income in taxes works out to be $9,288. And for the 2000s family, paying 33% of its income (a higher rate presumably because of progressivity... MORE
July 22, 2007
Income Distribution
Arnold Kling
Steve Kaplan and Joshua Rauh write, Overall, we estimate that the groups we study represent 15% to 26.5% of the individuals who comprise the AGI categories at and above the top 0.1%. Among the groups we study, non-financial public company... MORE
July 10, 2007
Income Distribution
Arnold Kling
From my latest essay: The distribution of rewards in America today is still relatively merit-based. However, the extent of economic and social mobility is difficult to assess. One optimistic indicator of mobility is that wealth differences across siblings remain fairly... MORE
June 13, 2007
Income Distribution
Arnold Kling
Stephen Rose writes, Demographic changes are the most important factors in explaining where productivity growth went. In essence, the United States used some of its growth dividend in the form of more people living alone. Read the whole paper. The... MORE
June 10, 2007
Income Distribution
Arnold Kling
David Leonhardt's story on Larry Summers makes it sound like Larry has moved to the dark side. Summers says. “And I think now the challenge is, again, to protect a basic market system based on open trade and globalization, to... MORE
June 7, 2007
Income Distribution
Arnold Kling
From a paper in the American Economic Review May 2007, by Anne Carroll, Hope Corman, Kelly Noonan, and Nancy E. Reichman. A maternal physical health condition that predated pregnancy reduces the likelihood that the child loses insurance by 6 percentage... MORE
June 6, 2007
Income Distribution
Arnold Kling
Shelley Lundberg and Robert A. Pollak write, The marriage-rate trajectories of the more- and less-educated began to diverge in the mid-1980s. Although college-educated men and women marry later than those with less education, they are now substantially more likely to... MORE
May 29, 2007
Income Distribution
Arnold Kling
Brink Lindsey writes, OK, so how do experts measure intergenerational income mobility anyway? Using survey data that tracks the income of the same individuals and families over time, researchers compare the income of parents at some specific age or age... MORE
Income Distribution
Arnold Kling
From The Economist, Avner Ahituv of the University of Haifa and Robert Lerman of the Urban Institute found that “entering marriage raises hours worked quickly and substantially.” Married men drink less, take fewer drugs and work harder, earning between 10%... MORE
May 23, 2007
Income Distribution
Arnold Kling
The Wall Street Journal refers to a Congressional Budget Office report which says, Average income for the bottom 20 percent of all households with children was 35 percent higher in 2005 than it had been in 1991. I am a... MORE
May 22, 2007
Income Distribution
Arnold Kling
Greg Mankiw writes, The neoclassical theory of distribution teaches us that a person's earnings depend on his or her productivity. But earnings are not the same as wealth. The accumulation of wealth is mostly about the ability to exert self-control.... MORE
May 17, 2007
Income Distribution
Arnold Kling
(I swear I posted on this first thing this morning, and now it's gone. It was a good post, too. I'm attempting to remember it here.) Tyler Cowen writes, For the economy as a whole, labor’s share of national income... MORE
Income Distribution
Arnold Kling
Robert H. Frank writes, But the biggest winners of all have been top earners in the financial services industry. Thus, according to Institutional Investor’s Alpha magazine, James Simons, a hedge fund manager, earned $1.7 billion last year, and two other... MORE
May 8, 2007
Labor Mobility, Immigration, Outsourcing
Arnold Kling
Michael Barone writes, Start with the Coastal Megalopolises: New York, Los Angeles, San Francisco, San Diego, Chicago (on the coast of Lake Michigan), Miami, Washington and Boston. Here is a pattern you don't find in other big cities: Americans moving... MORE
May 3, 2007
Income Distribution
Arnold Kling
My latest essay concerns poverty. the results of centrally-planned anti-poverty efforts are small, and perhaps negative (certainly very negative in the case of Communism). Decentralized capitalism, in which no one sets out to broadly reduce poverty, is the best anti-poverty... MORE
May 2, 2007
Income Distribution
Arnold Kling
With his new book, Poverty and Discrimination, Kevin Lang becomes my go-to guy on poverty. I disagree with him on some important and emotional points, and I'll have more to say about that at a later date. But I want... MORE
April 22, 2007
Income Distribution
Bryan Caplan
I was born into a family of tax consumers. My father was an engineer for a defense contractor during the last decades of the Cold War. My mom was a substitute teacher for the public schools, though she did spend... MORE
Income Distribution
Bryan Caplan
Last year, I convinced quite a few econo-bloggers to post their "class autobiographies." (Here was mine). One thoughtful reader suggested that it would have been more fruitful to build on John Calhoun's theory of class. For Calhoun, the relevant classes... MORE
April 13, 2007
Income Distribution
Arnold Kling
From Mind the Gap. Like chess or painting or writing novels, making money is a very specialized skill. But for some reason we treat this skill differently. No one complains when a few people surpass all the rest at playing... MORE
April 10, 2007
Income Distribution
Arnold Kling
Robert E. Rector, Christine Kim and Shanea Watkins write Overall, households headed by persons without a high school diploma (or low-skill households) received an average of $32,138 per household in direct benefits, means-tested benefits, education, and population-based services in FY... MORE
March 28, 2007
Income Distribution
Arnold Kling
Katz provides Greg Mankiw with some context for remarks quoted in a Wall Street Journal article. I substantially agreed with Eddie Lazear's view that a major part of the growth of U.S. earnings inequality is driven by rising returns to... MORE
March 16, 2007
Income Distribution
Arnold Kling
The IRS reports, For tax year 2004...Taxpayers with an AGI of at least $328,049, the top 1 percent of taxpayers, accounted for 19 percent of total AGI, representing an increase in income share of 2.2 percentage points from the previous... MORE
March 7, 2007
Income Distribution
Arnold Kling
How progressive is the current U.S. tax system? Not very, if you read the new paper in the Journal of Economic Perspectives by Thomas Piketty and Emmanuel Saez. As Mark Thoma reported, they say that The progressivity of the U.S.... MORE
March 4, 2007
Income Distribution
Arnold Kling
The Washington Post reports, As marriage with children becomes an exception rather than the norm, social scientists say it is also becoming the self-selected province of the college-educated and the affluent. The working class and the poor, meanwhile, increasingly steer... MORE
February 26, 2007
Income Distribution
Arnold Kling
From an editorial in the Seattle Times: Montana, for example, faces predictions of rapidly rising prison populations; Gov. Brian Schweitzer notes that 93 percent of the state's prisoners are incarcerated in part because of alcohol and drug addiction and 50... MORE
February 20, 2007
Income Distribution
Arnold Kling
Anne Kim, Adam Solomon, Bernard L. Schwartz, Jim Kessler, and Stephen Rose write, the “real” middle class is made up of households in their prime working years, ages 25-59, 75 percent of whom are couples and 56 percent of whom... MORE
February 19, 2007
Income Distribution
Arnold Kling
Stephanie Coontz writes, In 2001, University of Texas psychologist David M. Buss and colleagues compared mate preferences based on national surveys taken for several decades beginning in 1939. Their research, published in the Journal of Marriage and Family, found that... MORE
February 18, 2007
Income Distribution
Bryan Caplan
From Olaf Gersemann's Cowboy Capitalism: In the United States 41.4 percent of the cash transfers go to the poorest 30 percent of the population.Typical American indifference to the fate of the poor, right? Well, if that's American indifference, then what's... MORE
February 9, 2007
Income Distribution
Arnold Kling
At Cato Unbound, Alan Reynolds and his critics debate inequality statistics. So far, Reynolds and Gary Burtless have weighed in. For those interested in the topic, Brad DeLong has a reading list. I have an uneasy feeling that the people... MORE
January 25, 2007
Income Distribution
Arnold Kling
Tyler Cowen's NYT column today is a must read. In general, there is more income inequality among older populations than among younger populations, if only because older people have had more time to experience rising or falling fortunes. Furthermore, more-educated... MORE
Income Distribution
Arnold Kling
Bruce Bartlett writes (from behind the NYTimeSelect firewall, unfortunately), [Alan] Reynolds has been criticized for making too much of inherent limitations in the data that have been known for many years and for ignoring evidence that conflicts with his thesis.... MORE
December 28, 2006
Income Distribution
Arnold Kling
Tyler Cowen endorses the idea, with a twist. Just as the earned-income tax credit pays poor people to work, the universal 401(k) would pay poor people to save... There is an obvious way to pay for a universal 401(k) plan.... MORE
December 13, 2006
Income Distribution
Arnold Kling
In a comment on my earlier post, Dean Baker chided me for using anecdotes rather than data to make my claim that economic suffering is overstated in the media. Apparently, if I wanted to make my claim using data, I... MORE
December 12, 2006
Income Distribution
Arnold Kling
David Leonhardt writes, From World War II through the 1970s, while most Americans were getting solid raises every year, the incomes of the richest 1 percent were doing only a little better than inflation. Since the 1980s, the two groups... MORE
December 11, 2006
Income Distribution
Arnold Kling
Dean Baker writes, Larry Summers got fired from his last job as president of Harvard. He doesn't seem to be doing much better at his current job, working as a columnist at the Financial Times. Today's column rightly notes the... MORE
Income Distribution
Arnold Kling
I am reading Kay Hymowitz's book, Marriage and Caste in America. She was cited in the Wall Street Journal. Americans born into poverty have a long history of moving themselves, or their children, out of it. But the cycle of... MORE
December 4, 2006
Income Distribution
Arnold Kling
Peter Orszag writes, According to Yale's Jacob Hacker, the average family had a 7 percent chance in the early 1970s of seeing its income drop by half or more. By 2002, that probability rose to nearly 17 percent. This statistic... MORE
Books: Reviews and Suggested Readings
Arnold Kling
The above graph is lifted from a forthcoming book by Surjit S. Bhalla, called Second Among Equals: The Middle Class Kingdoms of India and China. It shows the share of the middle class in world population rising from 2... MORE
December 1, 2006
Income Distribution
Arnold Kling
Diana Furchtgott-Roth writes, Last year Americans in the lowest income quintile spent an average of $11,247 per person, according to the Bureau of Labor Statistics, compared with $15,843 for middle income quintiles, and $28,272 for the top quintile. The top... MORE
Income Distribution
Arnold Kling
Heather MacDonald writes Every 1,000 unmarried Hispanic women bore 92 children in 2003 (the latest year for which data exist), compared with 28 children for every 1,000 unmarried white women, 22 for every 1,000 unmarried Asian women, and 66 for... MORE
November 29, 2006
Income Distribution
Arnold Kling
My latest essay collects a lot of my thoughts on inequality. Since World War II, our economy has evolved in ways that reinforce the financial differences between strong families and weak families. As the earnings of women have risen, "assortive... MORE
November 27, 2006
Income Distribution
Arnold Kling
The New York Times' Louis Uchitelle writes, When it comes to wealth, one in every 325 households had a net worth of $10 million or more in 2004, the latest year for which data is available, more than four times... MORE
November 15, 2006
Income Distribution
Arnold Kling
Senator-elect Webb writes, The most important--and unfortunately the least debated--issue in politics today is our society's steady drift toward a class-based system...America's top tier has grown infinitely richer and more removed over the past 25 years. It is not unfair... MORE
October 30, 2006
Income Distribution
Arnold Kling
Larry Summers writes, As the great corporate engines of efficiency succeed by using cutting-edge technology with low-cost labour, ordinary, middle-class workers and their employers – whether they live in the American midwest, the Ruhr valley, Latin America or eastern Europe... MORE
October 26, 2006
Income Distribution
Arnold Kling
Fortune's Matt Miller writes, Here's my outlandish theory: that economic resentment at the bottom of the top 1 percent of America's income distribution is the new wild card in public life. Ordinary workers won't rise up against ultras because they... MORE
September 22, 2006
Income Distribution
Arnold Kling
Hal Varian reports on research by Jamie Galbraith and Travis Hale. According to Mr. Galbraith and Mr. Hale, much of the increase in income inequality in the late 1990’s resulted from large income changes in just a handful of locations... MORE
September 11, 2006
Income Distribution
Arnold Kling
Jonathan D. Fisher and David S. Johnson write, we show that there has been a large increase in income inequality but no concurrent increase in consumption inequality in the 1990s. Conversely, income mobility and consumption mobility are similar during this... MORE
September 6, 2006
Income Distribution
Arnold Kling
'Jane Galt' writes, when it comes to hyper-obsession with invisibly fine status distinctions, no banker could hold a candle to the average academic Read the whole thing, and also re-read Economic Man vs. Status Man. Incidentally, in Learning Economics, I... MORE
September 5, 2006
Income Distribution
Arnold Kling
Don Boudreaux pulls some facts out of a Bureau of Labor Statistics report. It's surprising (and important to note) that in 1901 only 19 percent of U.S. families owned a home; by 1972-1973, this figure had risen to 58.8; indeed,... MORE
September 4, 2006
Sebastian Mallaby writes, The same argument holds for tax incentives to buy health insurance. Just over a quarter of this subsidy is swallowed by households in the $100,000-plus bracket; far from promoting the wider dissemination of health insurance, it may... MORE
September 2, 2006
Behavioral Economics and Rationality
Arnold Kling
Brad DeLong serves, I'm enough of a touchy-feey sociology-lover to believe that a good chunk of the utility the rich derive from their conspicuous consumption is transferred to them from the poor: the happiness America's working poor and middle class... MORE
August 30, 2006
Income Distribution
Arnold Kling
Anne Kim, Adam Solomon, and Jim Kessler write, Progressive economists typically peg median household income at about $45,000. But that includes households headed by 22-year olds (who are on their way up) and 76-year olds (who live on fixed incomes... MORE
August 23, 2006
Income Distribution
Bryan Caplan
I've long been suspicious of international comparisons that weight all nations equally. When someone says "Former British colonies do better than former French colonies," my reaction is "Yes, but India did badly for decades, and it's probably got more people... MORE
August 15, 2006
Income Distribution
Bryan Caplan
My former student Daniel Lurker (and the youngest graduate in the history of GMU!) got his letter published in the Washington Post. You may even detect trace elements of my lectures: To read Brigid Schulte's recent "Class Questions" article about... MORE
August 8, 2006
Income Distribution
Arnold Kling
Nicholas Eberstadt writes Perhaps not surprisingly, adults without a high school diploma had significantly higher age-standardized death rates than the general population: In 2002, the differential was over 50 percent among both men and women. Despite the relative magnitude of... MORE
August 5, 2006
Income Distribution
Bryan Caplan
The homeless are different from you and me, and it's not because they have less money. It's because they are extraordinarily low in what personality psychologists call conscientiousness. That's my theory, anyway. A quite watchable documentary on Showtime (and that's... MORE
July 18, 2006
Income Distribution
Arnold Kling
Brad DeLong writes If it is luck or talent, the 60% of me that is a social democrat thinks that this is grossly unfair, and that we should think very seriously about powerful public policies that will level the distribution... MORE
June 14, 2006
Income Distribution
Arnold Kling
I think of Bryan as an IQ-ist. To me, IQ-ism is the doctrine that IQ determines many things in life, including income and health. I take the view that cultural and emotional factors matter. On cultural matters, see Judith Harris'... MORE
June 11, 2006
Income Distribution
Bryan Caplan
Greg Mankiw's posted a short class autobio. Highlight: My parents made what must have been a significant financial sacrifice for them to send me to a good private school, where most of the other kids were from families higher up... MORE
June 5, 2006
Income Distribution
Bryan Caplan
My boss, Don Boudreaux, has posted his class autobio. As you would expect, the man who rules me and my fellow professors with an iron hand grew up with a silver spoon in his mouth: I’m the only of my... MORE
Income Distribution
Arnold Kling
I put my views in an essay. When people care about their own children, there is bound to be some inequality. A friend of ours has worked in his parents' store since his early teens, and he probably has averaged... MORE
June 4, 2006
Income Distribution
Bryan Caplan
The most interesting comment I've gotten about class autobiography comes from James at Degrees of Freedom: I'm not a big fan of this theory of class, largely because it doesn't do what class theories are supposed to do according to... MORE
June 2, 2006
Income Distribution
Bryan Caplan
Quite a few bloggers took the bait and wrote their class autobiographies. Here are all the ones I'm aware of: Me Arnold Mark Thoma Alcibiades Chris Dillow Steve Miller Dennis Mangan James Don Boudreaux All of which confirms the conclusion... MORE
May 31, 2006
Income Distribution
Arnold Kling
My class autobiography got people riled up. More commenters were riled up at Economist's View than here, by the way. There are some things that I wrote that I don't wish to stand by and defend, after thinking about it... MORE
May 29, 2006
Income Distribution
Arnold Kling
Bryan is encouraging these things. On both sides of my family, my grandparents were immigrant Jews who tried to make a living as merchants. My mother's family settled in Bradford, Pennsylvania, a declining steel town. My father's family settled in... MORE
Income Distribution
Bryan Caplan
It's easy to miss: Mine would involve lots of sports, a mother who brought me to chess tournaments, a father who didn't believe in college, and a grandmother who loved Victor Hugo and Shakespeare.... MORE
Income Distribution
Bryan Caplan
Economist Mark Thoma has posted his class autobiography. My favorite parts: So, growing up I had a chip on my shoulder, probably still do. I was lucky though for two reasons. First, no matter what I did or how much... MORE
May 27, 2006
Income Distribution
Bryan Caplan
I grew up in an upper-middle class family in a suburb of Los Angeles. My father earned his Ph.D. in electrical engineering from UCLA when I was five; my mom went to college part-time at CSUN, and finished her bachelor's... MORE
May 25, 2006
Income Distribution
Bryan Caplan
Class Action challenges visitors to write a Class Autobiography: "Write your 'Class Autobiography.' A powerful way to reflect on class is to take an hour and write the story of your upbringing in relation to money and class." I had... MORE
May 16, 2006
Income Distribution
Bryan Caplan
In Stanley Milgram's famous Obedience to Authority Study, subjects were led to believe that they were giving another human being electric shocks. Many administered what they believed was a lethal dose, just because a man in a white coat told... MORE
May 9, 2006
Income Distribution
Arnold Kling
Val MacQueen writes Those expelled from East Africa were third generation immigrants to Africa, and had created assets and wealth. Which is why Idi Amin was so interested in them. Now, those families are again third generation immigrants, this time... MORE
March 22, 2006
Income Distribution
Arnold Kling
Charles Murray writes, Instead of sending taxes to Washington, straining them through bureaucracies and converting what remains into a muddle of services, subsidies, in-kind support and cash hedged with restrictions and exceptions, just collect the taxes, divide them up, and... MORE
March 8, 2006
Income Distribution
Arnold Kling
Inequality is the topic of both the latest Cato Unbound and the latest WSJ Celebrity Death Match. In the Cato piece, David Schmidtz writes, Here is a truism about the wealth of nations: Zero-sum games do not increase it. Historically,... MORE
January 29, 2006
Income Distribution
Arnold Kling
Brad DeLong asks, What skills and assets do the top 1% of America's pretax income distribution have today that lead the market to grant them 14% of total income, when their counterparts back in 1980 were granted only 8% of... MORE
January 18, 2006
Income Distribution
Arnold Kling
David Wessel writes, the best minds in labor economics differ on whether the 1990s and early 2000s are best seen as a continuation of the 1980s inequality trend (Harvard's Mr. Katz) or an end to it (Berkeley's David Card.) The... MORE
January 10, 2006
Income Distribution
Arnold Kling
James Heckman writes, Although much public policy discussion focuses on the failings of schools, a major finding from the research literature is that schools and school quality contribute little to the emergence of test-score gaps among children. By the second... MORE
November 14, 2005
Income Distribution
Arnold Kling
Alex Tabarrok writes, Expenditures on footwear by whites and other races: $274 Expenditures on footwear by blacks: $440. Chalk one up for the good Dr. Cosby. Alex is defending Bill Cosby against an attack by a Washington Post financial columnist.... MORE
September 23, 2005
Income Distribution
Arnold Kling
William Easterly writes (also can be found here) , The poor have neither the income nor political power to hold anyone accountable for meeting their needs--they are political and economic orphans. The rich-country public knows little about what is happening... MORE
September 15, 2005
Economics of Education
Arnold Kling
Robert M. Dunn complains, The disparities in college endowments are enormous. As of mid 2004, Harvard, Yale, and Princeton had average endowments of $14.9 billion, while three private institutions of similar size, George Washington University, Georgetown, and American University, averaged... MORE
September 4, 2005
Income Distribution
Arnold Kling
A classic rhetorical question is "If we can put a man on the moon, why can't we end poverty?" Russ Roberts attempts to answer. Putting a man on the moon is an engineering problem. It yields to a sufficient application... MORE
September 1, 2005
Economic Education
Arnold Kling
Michael Mandel writes, Four years of falling earnings for the college-educated. That hasn't happened since the 1970s... The only people doing well have advanced degrees. The world has changed. Just college is no longer enough. I'm basically an optimist, but... MORE
July 22, 2005
Income Distribution
Arnold Kling
Catching up on a week's worth of blog reading, the best thing I missed appears to be this post by Will Wilkinson. Richard Layard points out that one's perceived position in the income distribution is a better predictor of self-reported... MORE
July 13, 2005
Income Distribution
Arnold Kling
Robert J. Samuelson writes, Since 1970 the size of the average home has increased 55 percent (to 2,330 square feet), while the size of the average family has decreased 13 percent... the new American home is a residential SUV. It's... MORE
July 8, 2005
Income Distribution
Arnold Kling
In this essay, I offer some advice for people who care about African poverty. 1. The world is a complex place. The farther you are removed from a situation, the less likely that your intervention there will do good and... MORE
July 6, 2005
Income Distribution
Arnold Kling
While the consistently pessimistic and erroneous Louis Uchitelle is reassuring elitists that America's middle class is insecure and in need of help, economist Steve Rose is crunching some numbers. The approach used here tracks family incomes over 15 years for... MORE
April 29, 2005
Income Distribution
Arnold Kling
The latest Milken Institute Review has a number of interesting articles. For example, a report on the income status of second-generation immigrants. According to a new Census survey, the 30 million second-generation Americans seem well on their way to achieving... MORE
March 27, 2005
Income Distribution
Bryan Caplan
When people argue about whether immigrants are pulling down our standard of living, they rarely notice a simple but deep arithmetical fact: Everyone in a country can get richer as per-capita income falls. Proof by example: Suppose the residents of... MORE
March 3, 2005
Income Distribution
Arnold Kling
On my earlier post on income volatility, D-aquared asked why smaller risk pools would be efficient? His point is that if the problem is volatility, risk can be diversified away. If 10 families pool their savings, volatility will be lower... MORE
March 1, 2005
Income Distribution
Arnold Kling
The Los Angeles Times reports In the early 1970s, the inflation-adjusted incomes of most families in the middle of the economic spectrum bobbed up and down no more than about $6,500 a year, according to statistics generated by the Los... MORE
February 17, 2005
Income Distribution
Arnold Kling
Tim Worstall argues that big government is not compatible with only taxing the rich. For the fact is that the rich don't have enough money to pay for all of the things that are being demanded from the State. We... MORE
January 24, 2005
Income Distribution
Arnold Kling
Chris Dillow thinks that the Left has lost its moorings on the issue of income distribution. That is, Dillow supports income redistribution, but he thinks that neither the Left nor the Right is with him. Hayekian arguments can be applied... MORE
November 24, 2004
Income Distribution
Arnold Kling
The plight of low-skilled has received notice in several recent books. See Jane Galt's post, for example. Now, Russ Roberts weighs in. Waiters and waitresses, a janitor to push the improved vacuum cleaner or power waxer, the cleaning service that... MORE
November 18, 2004
Income Distribution
Arnold Kling
Jane Galt writes, Most of us reading this blog, after all, went to college and/or got nice steady jobs because we had enormous social and familial pressure on us to do so. How many of us were strong enough to... MORE
October 8, 2004
Growth: Causal Factors
Arnold Kling
Tim Worstall comments on a paper by William Nordhaus on the private vs. social returns of innovation. As a factor of production, the entrepreneur class (and yes, we have been considered for decades to be a factor of production to... MORE
September 24, 2004
Income Distribution
Arnold Kling
In this essay, I suggest using an escalator rather than a pie as a metaphor for differences in income. Overall, over 60 percent of families surveyed in 1975 made it to the top 40 percent in 1991. If the "distribution... MORE
September 20, 2004
Income Distribution
Arnold Kling
The Washington Post (possibly more reliable link here) does not use phony documents, but the thrust of the story, including the headline "More U.S. families struggle to stay on track" is at variance with the facts that they present. The... MORE
September 5, 2004
Cross-country Comparisons
Arnold Kling
The Wall Street Journal asks a series of questions to a number of Nobel Laureates in economics. On one question, whether the global income distribution will be more equal 50 years from now, several of them say "yes," because they... MORE
September 2, 2004
Income Distribution
Arnold Kling
Jeff Madrick is not impressed with Wal-Mart. Critics are compiling evidence that Wal-Mart's success, while entrenched in the brilliant management of new technologies, is dependent on low labor costs... A new study by Arindrajit Dube and Ken Jacobs of the... MORE
September 1, 2004
Income Distribution
Arnold Kling
Bruce Bartlett explains what is happening to the shrinking middle class. In fact, the ranks of the poor have fallen along with those of the middle class. Using the Times' characterization of any household with an income below $25,000 in... MORE
August 27, 2004
Income Distribution
Arnold Kling
My post-vacation essay is somewhat wide ranging. by far the biggest indicator that middle-class squeeze is not quite what is portrayed in the media was the volume of construction and the prices of homes. Since our first vacation there almost... MORE
July 23, 2004
Labor Market
Arnold Kling
Frank Levy and Richard J. Murnane predict that computer automation is leading to a split in the labor market. Good jobs will increasingly require expert thinking and complex communication. Jobs that do not require these tasks will not pay a... MORE
June 18, 2004
Income Distribution
Arnold Kling
Philosopher Keith Burgess-Jackson dissects the phrase. Nobody, to the liberal, has a valid claim on anything, even his or her talents. Those who produce or acquire wealth do so not because of effort, initiative, creativity, or sacrifice. They're just lucky.... MORE
May 20, 2004
Income Distribution
Arnold Kling
David R. Henderson and Charley Hooper argue that most of us are rich. Except for the few hundred thousand who are homeless, the Americans whom the U.S. government defines as poor live exceptionally rich lives. In most ways, their lives... MORE
May 3, 2004
Income Distribution
Arnold Kling
Allen R. Sanderson writes, no one complains when Ray Romano ("Raymond") gets $50 million a year—$1.8 million per episode—which takes about the same time to film as a baseball game...But let Alex Rodriguez sign for $25 million a year or... MORE
April 25, 2004
Income Distribution
Arnold Kling
Alex Tabarrok points to a paper by Uri Gneezy, Muriel Niederle, and Aldo Rustichini showing that although women solve a particular class of problems about as well as men on average, men improve their scores more than women when there... MORE
February 14, 2004
Income Distribution
Arnold Kling
Two new books give provocative answers. According to Houses Divided, reviewed here, Thomas M. Shapiro argues in this sober and authoritative book that we should look to disparities of wealth for the answer...Whites start out ahead because they inherit more... MORE
February 6, 2004
Income Distribution
Arnold Kling
The Chronicle of Higher Education discusses a number of income redistribution proposals. For example, Edmund Phelps has suggested a government wage subsidy for low-wage workers. Mr. Phelps argues that his plan -- which, in his view, should entirely replace the... MORE
January 25, 2004
Income Distribution
Arnold Kling
Robert E. Rector and Kirk A. Johnson offers some interesting facts concerning poverty in the United States, including Forty-six percent of all poor households actually own their own homes...The average poor American has more living space than the average individual... MORE
January 8, 2004
Income Distribution
Arnold Kling
Is the United States becoming a more rigid class society? Paul Krugman sounded such an alarm, but Tyler Cowen issues a rebuttal. Yes, there is some correlation in wealth across the generations. But most of that correlation (almost seventy percent)... MORE
September 29, 2003
Income Distribution
Arnold Kling
In an essay called Bleeding-Heart Libertarianism, I sketch a system for using a consumption tax with a negative-income-tax feature to replace government-provided health care, education, and income security. Does the bleeding-heart libertarian approach seem harsh? Actually, the Welfare State is... MORE
September 18, 2003
Income Distribution
Arnold Kling
Marc Brazeau asks (see Steve Antler's site), Two common arguments against raising the minimum wage are possible inflationary effects and job loss. Why aren't these issues raised in relation to executive compensation? I think that the conventional wisdom is that... MORE
September 4, 2003
Income Distribution
Arnold Kling
Jeff Madrick discusses the work of Elizabeth Warren and Amelia Warren Tyagi on the plight of middle-class two-income families with children. what families spend a lot more on, the authors calculate, is a house in a safe neighborhood with a... MORE
August 7, 2003
Information Goods, Intellectual Property
Arnold Kling
James Miller has an interesting thesis concerning information goods. Since most of the cost is up-front research and development, he argues that these goods will be priced attractively for mass consumption. As easily copied informational goods become more important to... MORE
July 25, 2003
Income Distribution
Arnold Kling
Some recent articles on income and wealth. Thomas Sowell writes, high tax rates hit people who are currently earning high incomes -- usually late in life, after having worked their way up in their professions over a period of decades.... MORE
June 27, 2003
Income Distribution
Arnold Kling
This week, the topic of income distribution made news. Several news outlets highlighted a report from the IRS on the 400 highest-income taxpayers. annual samples of individual income tax returns for Tax Years 1992 through 2000 were sorted by AGI,... MORE
June 4, 2003
Income Distribution
Arnold Kling
This week, there were a number of interesting comments on the topic of measuring income inequality and income mobility. In response to a question I raised about whether a measure of wealth should include expected future earnings, D-squared wrote, Absolutely... MORE
June 3, 2003
Income Distribution
Arnold Kling
Daniel Drezner assembles several items that refute the conventional wisdom that in the United States the poor get poorer as the rich get richer. If you care only about income, the poorest percentage of the population made great strides during... MORE
May 29, 2003
International Macroeconomics: Exchange Rates, International Debt, etc.
Arnold Kling
Prashant Kothari forwarded an email from one of his readers that said, I think global deflation is [in] the cards as long as we have free trade in goods and services. China is rapidly becoming a sophisticated manufacturer and there... MORE
April 10, 2003
Income Distribution
Arnold Kling
The May issue of The Atlantic Monthly pointed to this study of tax progressivity at the state level. The authors write, Our primary finding is that most state and local tax systems take a much greater share of income from... MORE
February 11, 2003
Income Distribution
Arnold Kling
One of the weaknesses of using income variation in a single year as a measure of the distribution of income is that people change income brackets over time. In general, the trend for any given household is upward, as households... MORE
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