Using financial incentives to encourage welfare recipients to become economically self-sufficient - commentary

Public welfare ; Poverty ; Employment (Economic theory)

Do Rising Top Incomes Lift All Boats?

Pooling data for 1905 to 2000, we find no systematic relationship between top income shares and economic growth in a panel of 12 developed nations observed for between 22 and 85 years. After 1960, however, a one percentage point rise in the top decile’s income share is associated with a statistically significant 0.12 point rise in GDP growth during the following year. This relationship is not driven by changes in either educational attainment or top tax rates. If the increase in inequality is permanent, the increase in growth appears to be permanent. However, our estimates imply that it would take 13 years for the cumulative positive effect of faster growth on the mean income of the bottom nine deciles to offset the negative effect of reducing their share of total income.inequality, growth, income distribution, national income

Do Rising Top Incomes Lift All Boats?

Pooling data for 1905 to 2000, we find no systematic relationship between top income shares and economic growth in a panel of 12 developed nations observed for between 22 and 85 years. After 1960, however, a one percentage point rise in the top decile's income share is associated with a statistically significant 0.12 point rise in GDP growth during the following year. This relationship is not driven by changes in either educational attainment or top tax rates. If the increase in inequality is permanent, the increase in growth appears to be permanent. However, our estimates imply that it would take 13 years for the cumulative positive effect of faster growth on the mean income of the bottom nine deciles to offset the negative effect of reducing their share of total income.inequality, growth, income distribution, national income

Inequality and Mortality: Long-Run Evidence from a Panel of Countries

We investigate whether changes in economic inequality affect mortality in rich countries. To answer this question we use a new source of data on income inequality: tax data on the share of pretax income going to the richest 10 percent of the population in Australia, Canada, France, Germany, Ireland, the Netherlands, New Zealand, Spain, Sweden, Switzerland, the UK, and the US between 1903 and 2003. Although this measure is not a good proxy for inequality within the bottom half of the income distribution, it is a good proxy for changes in the top half of the distribution and for the Gini coefficient. In the absence of country and year fixed effects, the income share of the top decile is negatively related to life expectancy and positively related to infant mortality. However, in our preferred fixed-effects specification these relationships are weak, statistically insignificant, and likely to change their sign. Nor do our data suggest that changes in the income share of the richest 10 percent affect homicide or suicide rates

American inequality and its consequences

Income inequality has risen sharply in the United States over the past generation, reaching levels not seen since before World War II. But while almost two-thirds of Americans agree with the statement that 'income differences in the United States are too large', policies aimed at reducing income differences command relatively little popular support. In most rich countries sizeable majorities 'agree strongly' that the government ought to guarantee each citizen a minimum standard of living. Only one American in four agrees strongly with this proposition. The same pattern holds in Congress, where legislators show little interest in policies aimed at taxing the rich, raising the wages of the poor, taxing inherited wealth, or guaranteeing shelter and health care to all Americans. The first three sections of this paper describe how the distribution of income has changed in the United States since the 1970s, why it changed, and why it is more unequal than the distribution in other rich democracies. We then assess the evidence on whether changes in economic inequality affect four other things that Americans care about - economic growth, equality of opportunity for children, longevity, and the distribution of political influence. Section 4 concludes that inequality probably does not have a consistent effect, either positive or negative, on economic growth in rich democracies. Section 5 shows that college attendance became more related to parental income as economic inequality increased in the United States, but it does not find much evidence that a father's economic status has had more influences on his children's economic prospects in the United States than in other rich countries where incomes were more equal. Section 6 argues that increases in economic inequality probably slow the rate of improvement in longevity, but the effect is very small. Thus, we conclude that rising inequality may have lowered life expectancy, but only by a few months. Section 7 discusses the impact of economic inequality on the distribution of political power, arguing that increases in economic inequality tend to increase the political power of the rich, at least in the United States. We conclude by arguing that since the effects of inequality on economic growth, health, and equality of opportunity are modest and uncertain in rich countries, these countries should decide how much economic inequality they are willing to tolerate largely on the basis of what they think is just

Income Inequality and Health: Strong Theories, Weaker Evidence

Many researchers and advocates believe that income inequality affects individual health, but empirical evidence has been inconclusive. A large body of research has found that income inequality is negatively correlated with average life expectancy, partly because a transfer of income from the poor to the rich is likely to harm the health of the poor more than it improves the health of the rich. A smaller body of work has investigated socioeconomic disparities in life expectancy, which widened in many countries after 1980, at the same time that income inequality was increasing. These two lines of work should be seen as complementary, because high and rising income inequality is unlikely to affect the health of all socioeconomic groups equally. Understanding the effects of income inequality on health requires attention to the mechanisms that affect the health of different income groups, changing average health, disparities in health, or (more likely) both. Rising income inequality can affect individuals in two ways. Direct effects change individuals’ own income. Indirect effects change other people’s income, which can then change a society’s politics, customs, and ideals, altering even the behavior of those whose own income remains unchanged. Indirect effects can thus change both average health and the slope of the relationship between individual income and health

Do Rising Top Incomes Lift All Boats?

Pooling data for 1905 to 2000, we find no systematic relationship between top income shares and economic growth in a panel of 12 developed nations observed for between 22 and 85 years. After 1960, however, a one percentage point rise in the top decile’s income share is associated with a statistically significant 0.12 point rise in GDP growth during the following year. This relationship is not driven by changes in either educational attainment or top tax rates. If the increase in inequality is permanent, the increase in growth appears to be permanent, but it takes 13 years for the cumulative positive effect of faster growth on the mean income of the bottom nine deciles to offset the negative effect of reducing their share of total income

School Accountability, Postsecondary Attainment and Earnings

We study the impact of accountability pressure in Texas public high schools in the 1990s on postsecondary attainment and earnings, using administrative data from the Texas Schools Project (TSP). We find that high schools respond to the risk of being rated Low-Performing by increasing student achievement on high-stakes exams. Years later, these students are more likely to have attended college and completed a four-year degree, and they have higher earnings at age 25. However, we find no overall impact - and large declines in attainment and earnings for low-scoring students - of pressure to achieve a higher accountability rating

Sociological and Human Developmental Explanations of Crime: Conflict or Consensus

This paper examines multidisciplinary correlates of delinquency in an attempt to integrate sociological and environmental theories of crime with human developmental and biological explanations of crime. Structural equation models are applied to assess links among biological, psychological, and environmental variables collected prospectively from birth through age 17 on a sample of 800 black children at high risk for learning and behavioral disorders. Results show that for both males and females, aggression and disciplinary problems in school during adolescence are the strongest predictors of repeat offense behavior. Whereas school achievement and family income and stability are also significant predictors of delinquency for males, early physical development is the next strongest predictor for females. Results indicate that some effects on delinquency also vary during different ages. It is suggested that behavioral and learning disorders have both sociological and developmental correlates and that adequate educational resources are necessary to ensure channels of legitimate opportunities for high-risk youths

Work and Welfare in the American States: Analyzing the Effects of the JOBS Program

This research seeks to determine whether the Job Opportunities and Basic Skills GOBS) program (established under the 1988 Family Support Act) was successful in reducing the number of welfare recipients among U.S. states for the period 1984 to 1996. Within the context of two theoretical perspectives-developmental and rational choice-we assess the impact of JOBS on AFDC participation rates using a pooled time-series design. At best, JOBS had a minimal effect. We estimate that states with higher proportions of their AFDC populations enrolled in JOBS programs had only slightly lower rates of participation in AFDC. Other forces were far more influential in reducing welfare participation. In particular, states with higher per capita income, lower female unemployment rates, lower poverty rates, and higher wages for low-paying jobs had the lowest welfare recipiency The AFDC participation rates of neighboring states had a significant effect, as well. The analysis showed that more generous AFDC benefits exerted strong upward pressure on a state's welfare rolls.Yeshttps://us.sagepub.com/en-us/nam/manuscript-submission-guideline