A vulnerability approach to the definition of the middle class

Measurement of the middle class has recently come to the center of policy debate in middle-income countries as they search for the potential engines of growth and good governance. This debate assumes, first, that there is a meaningful definition of class, and second, that thresholds that define relatively homogeneous groups in terms of pre-determined sociological characteristics can be found empirically. This paper aims at proposing a view of the middle class based on vulnerability to poverty. Following this approach the paper exploits panel data to determine the amount of comparable income -- associated with a low probability of falling into poverty -- which could define the lower bound of the middle class. The paper looks at absolute thresholds, challenging the view that people above the poverty line are actually part of the middle class. The estimated lower threshold is used in cross-section surveys to quantify the size and the evolution of middle classes in Chile, Mexico, and Peru over the past two decades. The first relevant feature relates to the fact that the proposed thresholds lie around the 60th percentile of the distribution. The evidence also shows that the middle class has increased significantly in all three countries, suggesting that a higher number of households face lower probabilities of falling into poverty than they did in the 1990s. There is an important group of people, however, which cannot be defined as middle class from this perspective, but are not eligible for poverty programs according to traditional definitions of poverty.Rural Poverty Reduction,Inequality,Regional Economic Development,Urban Partnerships&Poverty,Services&Transfers to Poor

Adsorption of Xe atoms on metal surfaces: New insights from first-principles calculations

The adsorption of rare gases on metal surfaces serve as the paradigm of weak adsorption where it is typically assumed that the adsorbate occupies maximally coordinated hollow sites. Density-functional theory calculations using the full-potential linearized augmented plane wave method for Xe adatoms on Mg(0001), Al(111), Ti(0001), Cu(111), Pd(111), and Pt(111), show, however, that Xe prefers low-coordination on-top sites in all cases. We identify the importance of polarization and a site-dependent Pauli repulsion in actuating the site preference and the principle nature of the rare-gas atom--metal surface interaction.Comment: 5 pages including 4 figure files. Related publications can be found at http://www.fhi-berlin.mpg.de/th/paper.htm

Non-Gaussian dynamic Bayesian modelling for panel data

A first order autoregressive non-Gaussian model for analysing panel data is proposed. The main feature is that the model is able to accommodate fat tails and also skewness, thus allowing for outliers and asymmetries. The modelling approach is to gain sufficient flexibility, without sacrificing interpretability and computational ease. The model incorporates individual effects and we pay specific attention to the elicitation of the prior. As the prior structure chosen is not proper, we derive conditions for the existence of the posterior. By considering a model with individual dynamic parameters we are also able to formally test whether the dynamic behaviour is common to all units in the panel. The methodology is illustrated with two applications involving earnings data and one on growth of countries.autoregressive modelling; growth convergence; individual effects; labour earnings; prior elicitation; posterior existence; skewed distributions

Model-based Clustering of non-Gaussian Panel Data

In this paper we propose a model-based method to cluster units within a panel. The underlying model is autoregressive and non-Gaussian, allowing for both skewness and fat tails, and the units are clustered according to their dynamic behaviour and equilibrium level. Inference is addressed from a Bayesian perspective and model comparison is conducted using the formal tool of Bayes factors. Particular attention is paid to prior elicitation and posterior propriety. We suggest priors that require little subjective input from the user and possess hierarchical structures that enhance the robustness of the inference. Two examples illustrate the methodology: one analyses economic growth of OECD countries and the second one investigates employment growth of Spanish manufacturing firmsautoregressive modelling; employment growth; GDP growth convergence; hierarchical prior; model comparison; posterior propriety; skewness

The Decline in Inequality in Latin America: How Much, Since When and Why

Between 2000 and 2009, the Gini coefficient declined in 13 of 17 Latin American countries for which comparable data exist. The decline was statistically significant and robust to changes in the time interval, inequality measures and data sources. In depth country studies for Argentina, Brazil, Mexico and Peru suggest that there are two phenomena which underlie this trend: (i) a fall in the premium to skilled labor (as measured by returns to education); and (ii) higher and more progressive government transfers. The fall in the premium to skills results from a combination of supply and demand factors and, in Argentina and, to a lesser extent, in Brazil, from more active labor market policies as well.Income inequality, wage gap, government transfers, Latin America

Energy dependence of the quark masses and mixings

The one loop Renormalization Group Equations for the Yukawa couplings of quarks are solved. From the solution we find the explicit energy dependence on $t=\ln E/\mu$ of the evolution of the {\em down} quark masses $q=d,s,b$ from the grand unification scale down to the top quark mass $m_{t}$. These results together with the earlier published evolution of the {\em up} quark masses completes the pattern of the evolution of the quark masses. We also find the energy dependence of the absolute values of the Cabibbo-Kobayashi-Maskawa (CKM) matrix $|V_{ij}|$. The interesting property of the evolution of the CKM matrix and the ratios of the quark masses: $m_{u,c}/m_{t}$ and $m_{d,s}/m_{b}$ is that they all depend on $t$ through only one function of energy $h(t)$.Comment: Talk presented at the IX Mexican School on Particles and Fields, August 9-19, Metepec, Pue., Mexico. To be published in the AIP Conference Proceedings. 5 pages and 1 eps figure included in the tex

Understanding the Clean Interface between Covalent Si and Ionic Al2O3

The atomic and electronic structures of the (001)-Si/(001)-gamma-Al2O3 heterointerface are investigated by first principles total energy calculations combined with a newly developed "modified basin-hopping" method. It is found that all interface Si atoms are fourfold coordinated due to the formation of Si-O and unexpected covalent Si-Al bonds in the new abrupt interface model. And the interface has perfect electronic properties in that the unpassivated interface has a large LDA band gap and no gap levels. These results show that it is possible to have clean semiconductor-oxide interfaces