Relative Income, Redistribution and Well-being

In a model with heterogeneous workers and both intensive and extensive margins of employment, we consider two systems of redistribution: a universal basic income, and a categorical unemployment benefit. Well-being depends on own-consumption relative to average employed workers’ consumption, and concern for relativity is a parameter that affects model outcomes. While labour supply incurs positive marginal disutility, we allow negative welfare effects of unemployment. We also compare Rawlsian and utilitarian welfare in general equilibrium under the polar opposite transfer systems, with varying concern for relativity. Basic income Pareto dominates categorical benefits with moderate concern for relativity in both cases.relative income, redistribution, basic income, unemployment benefits, happiness, well-being

Age, Life-Satisfaction, and Relative Income: Insights from the UK and Germany

We first confirm previous results with the German Socio-Economic Panel by Layard et al. (2010), and obtain strong negative effects of comparison income. However, when we split the sample by age, we find quite different results for reference income. The effects on life-satisfaction are positive and significant for those under 45, consistent with Hirschman's (1973) 'tunnel effect', and only negative (and larger than in the full sample) for those over 45, when relative deprivation dominates. Thus for young respondents, reference income's signalling role, indicating potential future prospects, can outweigh relative deprivation effects. Own-income effects are also larger for the older sample, and of greater magnitude than the comparison income effect. In East Germany the reference income effects are insignificant for all. With data from the British Household Panel Survey, we confirm standard results when encompassing all ages, but reference income loses significance in both age groups, and most surprisingly, even own income becomes insignificant for those over 45, while education has significant negative effects.subjective life-satisfaction, comparison income, reference groups, age, welfare

League tables and concentric banding: how similar are the employment and education domains of the Index of Multiple Deprivation 2010?

This paper seeks to provide further evidence about ‘league table’ orderings for deprivation in local areas, especially for two domains – employment and education – which seem likely to be closely related. Rather than relying solely on administrative Local Authority areas and functional economic areas, our focus is to refine the concentric banding approach introduced in Nolan et al. (Local Economy 27(4): 403–418, 2012), and to apply it throughout England. We also introduce two new procedures by which areas might be systematically split into smaller components. The spatial distributions of employment and education deprivation turn out to be quite different (and distinct from the spatial distribution of overall deprivation). Throughout, there is clear evidence that it matters what size of local area is considered

So Far so Good: Age, Happiness, and Relative Income

In a simple 2-period model of relative income under uncertainty, higher comparison income for the younger cohort can signal higher or lower expected lifetime relative income, and hence either increase or decrease well-being. With data from the German Socio-Economic Panel and the British Household Panel Survey, we first confirm the standard negative effects of comparison income on life satisfaction with all age groups, and many controls. However when we split the West German sample by age we find a positive significant effect of comparison income in the under 45s, and the usual negative effect only in the over 45 group. With the same split in UK and East German data, comparison income loses significance, which is consistent with the model prediction for the younger group. Our results provide first evidence that the standard aggregation with only a quadratic control for age can obscure major differences in the effects of relative income.Subjective life-satisfaction, comparison income, reference groups, age, welfare

Employee participation, job quality, and inequality

PurposeThe purpose is to review the effects of employee participation (EP) in decision-making, ownership and profit on job quality, worker well-being and productivity, and derive policy recommendations from the findings.Design/methodology/approachThe authors summarise results of “declining labour power”, plus theoretical arguments and empirical evidence for the benefits of EP for job quality, satisfaction and productivity.FindingsWorker well-being and job satisfaction are ignored unless they contribute directly to profitability. EP is needed to remedy this situation when employers have market power and unions are weak. The result can be a rise in both productivity and well-being.Research limitations/implicationsThe chief issue here is that there are data limitations, particularly on the well-being effects of participation.Practical implicationsLots of encouraging examples in many countries need legislative help to multiply.Social implicationsIt is quite possible that there could be major implications for welfare and employment.Originality/valueThe authors make the case for public sector subsidies for employee buyouts and new cooperative start-ups, as well as legislation for works councils and profit sharing

Education, income and happiness: Panel evidence for the UK

Using panel data from the BHPS and its Understanding Society extension, we study life satisfaction (LS) and income over nearly two decades, for samples split by education, and age, to our knowledge for the first time. The highly educated went from lowest to highest LS, though their average income was always higher. In spite of rapid income growth up to 2008/2009, the less educated showed no rise in LS, while highly educated LS rose after the crash despite declining real income. In panel LS regressions with individual fixed effects, none of the income variables was significant for the highly educated

Income Status and Life Satisfaction

The importance of both income rank and relative income, as indicators of status, has long been recognised in the literature on life satisfaction and happiness. Recently, several authors have made explicit comparisons of the relative importance of these two measures of income status, and concluded that rank dominates to the extent that reference income becomes insignificant in regressions including both these explanatory variables, and that even absolute or household income, otherwise always positively related to happiness, may lose statistical significance. Here we test this hypothesis with a large UK panel (British Household Panel Survey and Understanding Society) for 1996–2017, split by age and retirement status, and find, contrary to previous results, that rank, household income and reference income are all usually important explanatory variables, but with significant differences between subgroups. This finding holds when rank is in its often-used relative form, and also with absolute rank

AGU hydrology days 2004

24th annual AGU hydrology days was held at Colorado State University on March 10-12, 2004.List of abstracts of presentations given at the AGU Hydrology Days 2004