Distributional Effects of Public Education Transfers in Seven European Countries. ESRI WP207. September 2007

Empirical studies of inequality and poverty are usually based on disposable cash incomes, disregarding incomes in-kind (non-cash incomes). Since individuals also derive utility from the consumption of goods and services provided in-kind monetary income is not always a good indicator of an individual’s utility or “command over resources”. Thus, distributional analysis based on cash incomes may be seriously biased. Inclusion of non-cash incomes (arising from private sources or from public provision of services such as health, housing and education) may allow for better targeting and allocation of resources in fighting poverty and social exclusion. The present paper focuses on non-cash incomes arising from publicly provided education in seven European countries (Belgium, Germany, Greece, Italy, Ireland, the Netherlands and the UK), as part of a broader research project (AIM-AP Accurate Income Measurement for the Assessment of Policy) investigating the distributional implications of including elements of non-cash income in the measurement of wider resources

Oral History Interview, Tim Smeeding (2162)

In this interview, Tim Smeeding outlines his career in public affairs and economics, and reflects on winning the 2022 Hilldale Award. He also discusses his background as a graduate student at UW-Madison where he attended the Institute for Research in Poverty in the 1970s. To learn more about this oral history, download & review the index first (or transcript if available). It will help determine which audio file(s) to download & listen to.In this July 22nd, 2022 interview with Francisco Hernandez Moleres, Prof. Timothy Smeeding reflects on his career in public affairs and economics, and shares his thoughts about receiving the 2022 Hilldale Award. Throughout the conversation, Prof. Smeeding describes his formative years as a graduate student at UW-Madison’s Institute for Research in Poverty in the 1970s and his return to that same university as a professor in 2007. He notes his passion for studying inequality within and across multiple countries, and he highlights the influences of former colleagues Lee Rainwater and Patrick Moynihan. Prof. Smeeding discusses his work advising government policy—notably the American Rescue Plan of 2021—his teaching experience at UW-Madison, and his professional service in the National Academy of Sciences and the Association for Public Policy Analysis

Distributional Effects of Public Education Transfers in Seven European Countries

Empirical studies of inequality and poverty are usually based on disposable cash incomes, disregarding incomes in-kind (non-cash incomes). Since individuals also derive utility from the consumption of goods and services provided in-kind monetary income is not always a good indicator of an individual's utility or ?command over resources?. Thus, distributional analysis based on cash incomes may be seriously biased. Inclusion of non-cash incomes (arising from private sources or from public provision of services such as health, housing and education) may allow for better targeting and allocation of resources in fighting poverty and social exclusion. The present paper focuses on non-cash incomes arising from publicly provided education in seven European countries (Belgium, Germany, Greece, Italy, Ireland, the Netherlands and the UK), as part of a broader research project (AIM-AP Accurate Income Measurement for the Assessment of Policy) investigating the distributional implications of including elements of non-cash income in the measurement of wider resources. In all countries under examination public education transfers account for a considerable proportion of the total transfers of the state to the citizens. The paper uses static incidence analysis under the assumption that public education transfers do not create noticeable externalities, combining the information of existing nationwide income surveys with external information on spending per student in particular levels of the education system. In all countries public education transfers are found to reduce aggregate inequality. These effects are driven by the impact of primary and, especially, secondary education transfers at the time of their receipt and assuming benefits are valued at cost by recipients. In a static framework, transfers in the field of tertiary education appear to have a small distributional impact while the size and the sign of this impact depend on the treatment of tertiary education students living away from the parental home.

The Joint Distribution of Household Income and Wealth: Evidence from the Luxembourg Wealth Study

This report looks at the extent to which household net worth and disposable income are correlated across individuals. After having briefly discussed the importance of better information on household wealth for social policies, the paper describes the main features of the Luxembourg Wealth Study – a collaborative project to assemble existing micro-data on household wealth into a coherent database that aims to do for wealth what the Luxembourg Income Study has achieved for income– and some of the basic patterns highlighted by these data, while noting the important methodological features that affect comparability. The main bulk of the report focuses on the joint distribution of income and wealth. While the comprehensive definition of wealth used (i.e. including business equity) allows covering only five OECD countries, the analysis uncovers a number of patterns. In particular, household net worth and disposable income are highly, but not perfectly correlated across people within each country. Many of the people classified as income poor do have some assets, although both the prevalence of holding and the amounts are clearly lower than among the general population. While part of the positive association between disposable income and net worth reflects observable characteristics of households, such as age and education of the household head, a sizeable correlation remains even after controlling for these characteristics. Ce rapport examine la corrélation entre le patrimoine des ménages et leur revenu disponible. Après avoir brièvement évoqué l’importance d’une meilleure information sur les patrimoines pour les politiques sociales, le document décrit les principales caractéristiques du Luxembourg Wealth Study (LWS) – un projet mené pour réunir les micro-données existantes sur le patrimoine des ménages dans une base de données cohérente, visant à accomplir pour les patrimoines ce que le Luxembourg Income Study (LIS) a réussi pour les revenus. Le rapport décrit quelques aspects fondamentaux mis en relief par ces données, tout en notant les caractéristiques méthodologiques qui ont un effet sur la comparabilité internationale. La partie centrale du rapport se concentre sur la distribution conjointe du patrimoine et du revenu. Alors que la définition du patrimoine utilisée (incluant les actifs professionnels) permet de couvrir seulement cinq pays de l’OCDE, l’analyse révèle un nombre d’éléments. La corrélation entre patrimoine et revenu disponible des individus dans chaque pays est élevée mais pas pour autant parfaite. Beaucoup de personnes ayant un revenu inférieur au seuil de pauvreté ont un patrimoine positif, bien que les personnes dans cette situation et les montants détenus soient clairement plus faibles que pour la population dans son ensemble. Si une partie de la corrélation positive entre revenu et patrimoine révèle des caractéristiques observables des ménages, telles que l’âge et l’éducation des chefs de famille, il n’en demeure pas moins qu’une corrélation non négligeable subsiste même après avoir contrôlé l’effet de ces caractéristiques.

Rising Income Inequality and Living Standards in OECD Countries: How Does the Middle Fare?

Income inequality has increased in a number of the rich democratic nations over the past generation. We examine whether this has reduced income growth for middleincome households. Using LIS, OECD and WID data, we show how median household incomes and income inequality have evolved between 1980 and 2013, and we analyse whether these trends are related. Growth in median incomes is negatively associated with changes in the Gini but not with changes in top income shares. Economic growth is strongly associated with growth in median incomes, although it does not seem to fully transmit