Economic impact of poverty and social isolation: an exploration with US State data

A. Objectives: The policy debates surrounding the apparent trade-off between economic growth and income inequality, and consequent increase in poverty rate, have gained momentum since the financial debacle in 2008. In this paper, we explore the causal link between poverty, economic performance and social isolation. We contribute to the literature in two ways; first, our analysis overcomes the limitations of cross-country studies by using state-level data for three years-2000, 2005 and 2010; second, we include a variable for social isolation, to explain the differences in economic performances across the US states. We posit that social isolation, defined as poor English language proficiency, restricts economic integration and hence has a negative economic impact. B. Data and Methods: Employing data from the US Bureau of Census, we explore if differences in the poverty rate and linguistic isolation can explain the differences in Gross State Product (GSP) per capita across 50 US states. We estimate equation (1): [see presentation page 8 for equation] In equation (1), α2 represents state fixed effects (for state specific unobserved factors) ,D₁ and D₂ are time dummy variables for year 2005 and 2010, respectively, and s(s,t)is a vector of control variables (educational attainment, employment in manufacturing industries and density of population).The dependent variable is GSP per capita (in 2005 prices) and the main causal variable x s,t is defined as the headcount index. The interactive term measures the possibility that the marginal impact of poverty on GSP depends on social isolation z(s,t). We argue that the negative impact of poverty will be higher for states with a higher proportion of socially isolated people. C. Results & Concluding Remarks: We conduct a Breusch-Pagan (BP) Test and a Hausman test to check for Fixed Effect (FE) specification. Both tests reject the null hypotheses for pooled OLS and Random Effect model. FE estimation of equation (1) reports that the coefficients for x(s,t) and its interactive term with z(s,t)are negative and are statistically significant. Our estimates indicate that a 1% increase in poverty rate, GSP per capita reduces by 1.4%, and it could further reduce by a 0.08 % in states with a higher proportion of linguistically isolated people. We checked for model robustness, against omitted variables, and estimation with 48 continental states. Our results provide an economic rationale for reducing social isolation, as part of the poverty reduction strategies in the US, and countries like the UK, with large immigrant population

Responding to global challenges in food, energy, environment and water: Risks and options assessment for decision-Making

We analyse the threats of global environmental change, as they relate to food security. First, we review three discourses: (i) ‘sustainable intensification’, or the increase of food supplies without compromising food producing inputs, such as soils and water; (ii) the ‘nexus’ that seeks to understand links across food, energy, environment and water systems; and (iii) ‘resilience thinking’ that focuses on how to ensure the critical capacities of food, energy and water systems are maintained in the presence of uncertainties and threats. Second, we build on these discourses to present the causal, risks and options assessment for decision-making process to improve decision-making in the presence of risks. The process provides a structured, but flexible, approach that moves from problem diagnosis to better risk-based decision-making and outcomes by responding to causal risks within and across food, energy, environment and water systems

Denying the pleasure of scrumptious downtowns? : evidence on economics of diversity in the US

This paper investigates whether barriers to communication due to social diversity influence labour productivity across metropolitan areas in the United States. We contend that some forms of social diversity can increase the cost of communication and, thus, retard the diffusion and creation of productivity enhancing knowledge. We investigate this hypothesis using a panel dataset for three census years: 1980, 1990 and 2000, to estimate the economic impact of diversity on labour productivity (measured as average wage) across American cities. As part of the estimation we use three measures for diversity – racial, cultural or linguistic, along with a set of control variables including educational attainment, and demographic variables. Our initial findings indicate: one, racial diversity reduces labour productivity; two, linguistic diversity and cultural diversity enhance labour productivity, but barriers to communication mitigate the positive effects of linguistic diversity. The robustness of the ordinary least-squares results is supported by Instrumental Variable Estimation to account for potentially endogenous variables. Overall, the results provide insights regarding ‘state-sponsored’ multiculturalism and the economic impacts of social capital

Diversity and 'economic assimilation' of immigrant workers: evidence from cities in the USA

We examine if barriers to communication, created through differences in language, culture, religion or race, retard economic assimilation of immigrants workers in American metropolitan areas. Employing a panel dataset for three census years: 1980, 1990 and 2000; we estimate the impact of diversity on labour productivity (measured as average wage). Our findings indicate: one, racial diversity reduces labour productivity; two, linguistic diversity and cultural diversity enhance labour productivity, but barriers to communication mitigate the positive effects of linguistic diversity. We also discuss preliminary results of the investigation on the impact of diversity on wage gaps between immigrant and native workers

Are migrants good for the host country's economy?

International migration is driven not only by push factors at countries of origin but also by pull factors at countries of destination. Immigrant workers often come to fill labour market gaps in destination countries, whether in jobs that native workers are no longer willing to take or filling in shortages in specific skills or sectors that are rapidly expanding and where the domestic labour force cannot meet the demand of the labour market. The fact that migrants fill in shortages in the labour market does not necessarily mean that they are good for the host country's economy

Is interdisciplinary research a necessary evil in the post-COVID era? Developing a women empowerment in Migration Index

Evidence on the number of migrant women affected by forced labour and human trafficking is scant. Alarmingly so is the lack of focus on women’s agency in the numerous research on female migration across disciplines. In this paper, I discuss the conceptual framework of the Women Empowerment in Migration Index (WEMI), which is, to my knowledge, the first index focusing on the multidimensional agency of female migrants. I argue that evaluating the three dimensions of women’s agency, intrinsic, instrumental, and collective, is integral to monitoring the real progress towards SDG 8.7 on the eradication of forced labour, modern slavery, and human trafficking. Lastly, I discuss the rationale for adopting an interdisciplinary approach and the necessity to go beyond the more seemingly objective indicators of economic resources and achievements at the household level in the post-COVID era

Can ROAD work better for climate vulnerable population of Bangledesh? Some preliminary thoughts

Global Resilience Challenges •Average food prices rose some 80%, on average, from 2005 to 2008 •39.9% of population are poor in fragile and conflict-affected areas •51 food riots in 37 countries between 2007 and 2014 •Global population to reach 9.6 billion in 2050 •On current trends projected world will: –Produce 50% more food –Extract 55% more water –Use 40% more primary energ

Do the teachers share the greater 'burden' of blended learning? : an evaluation of innovative approaches to economics teaching

Teachers are increasingly expected by university management to teach using flexible, blended and online teaching practices. Some teachers are intrinsically motivated to innovative, while others widespread resistance. In this paper we use the Cost-Benefit Analysis (CBA) framework to evaluate the adoption of innovative approaches for teaching two economics courses at Lincoln University. Although it is difficult to estimate the costs and benefit in dollar value, as is done in a traditional economic analysis, we argue that the CBA framework provides a rationale for adoption for individual teachers, and more importantly, a very clear policy direction for those who are tasked with shifting teaching practice across an entire faculty or institution

Optimal ‘métissage’ for economic advancement: evidence from the US and Canada

We examine the influences of diversity on level and growth rate of GDP at the state and province level in the United States and Canada. Although cross-country studies typically claim that diversity reduces productivity, recent studies with US datasets argue that cultural, linguistic and/or racial diversity contributes positively to aggregate economic performance. The notion is that regions that promote diversity stimulate innovation by building complementarities in knowledge, skills and experiences. Employing a cross-sectional dataset for 48 contiguous states in the US and 10 provinces in Canada, our work measures the impact of ‘social divergence’ - defined as economic effects of barriers to communication created through differences in language, culture, race, ethnicity or religion - on per capita output. We include three measures of diversity, using fractionalisation indices for linguistic, religious, and cultural differences across the states/provinces; and a set of control variables: educational attainment, urbanization, population density, percentage of working age population, and an index of economic freedom. To test the social divergence hypotheses, an interaction term, with a proxy for low level of English fluency, is also included in the OLS estimation. Based on an exhaustive set of robustness tests, we obtain two robust and statistically significant results: one, the estimated coefficients on diversity, variously measured, have a positive impact on per capita output across states and provinces; two, the coefficient of interaction variable is negative, implying that barriers to communication mitigate the positive effects of diversity. The robustness of the OLS results is reinforced when Instrumental Variable Estimation is employed for the potential endogenous variables. Our findings contribute to current policy debates around ‘state-sponsored’ multiculturalism in Canada and provide fresh insights on the use of social capital as a public policy tool in all settler societies. We intend to carry out further research at the city/county level