An Empirical Analysis of Income Dynamics among Men in the PSID: 1968–1989

This study uses data from the Panel Survey of Income Dynamics (PSID) to address a number of questions about life-cycle earnings mobility. It develops a dynamic reduced-form model of earnings and marital status that is nonstationary over the life-cycle. A Gibbs sampling-data augmentation algorithm facilitates use of the entire sample and provides numerical approximations to the exact posterior distribution of properties of earnings paths. This algorithm copes with the complex distribution of endogenous variables that are observed for short segments of an individual’s work history, not including the initial period. The study reaches several firm conclusions about life cycle earnings mobility. Incorporating non-Gaussian shocks makes it possible to account for transitions between low and higher earnings states, a heretofore unresolved problem. The non-Gaussian distribution substantially increases the lifetime return to postsecondary education, and substantially reduces differences in lifetime wages attributable to race. In a given year, the majority of variance in earnings not accounted for by race, education, and age is due to transitory shocks, but over a lifetime the majority is due to unobserved individual heterogeneity. Consequently, low earnings at early ages are strong predictors of low earnings later in life, even conditioning on observed individual characteristics.

A structural model of multiple welfare program participation and labor supply

One of the long-standing issues in the literature on transfer programs for the U.S. low-income population concerns the high cumulative marginal tax rate on earnings induced by participation in the multiplicity of programs offered by the government. Empirical work on the issue has reached an impasse partly because the analytic solution to the choice problem is intractable and partly because the model requires the estimation of multiple sets of equations with limited dependent variables, an estimation problem which until recently has been computationally infeasible. In this paper we estimate a model of labor supply and multiple program participation using methods of simulation estimation that enable us to solve both problems. The results show asymmetric wage and tax rate effects, with fairly large wage elasticities of labor supply but very inelastic responses to moderate changes in cumulative marginal tax rates, implying that high welfare tax rates do not necessarily induce major reductions in work effort.

Color, composition, and thermal environment of Kuiper Belt object (486958) Arrokoth

The outer Solar System object (486958) Arrokoth (provisional designation 2014 MU₆₉) has been largely undisturbed since its formation. We study its surface composition using data collected by the New Horizons spacecraft. Methanol ice is present along with organic material, which may have formed through irradiation of simple molecules. H₂O ice is not detected. This composition indicates hydrogenation of CO-rich ice and/or energetic processing of CH₄+H₂O ices in the cold, outer edge of the early Solar System. There are only small regional variations in color and spectra across the surface, suggesting Arrokoth formed from a homogeneous or well-mixed reservoir of solids. Microwave thermal emission from the winter night side is consistent with a mean brightness temperature of 29 ± 5 K

Inequality, Transfers and Growth: New Evidence from the Economic Transition in Poland

This paper challenges the conventional wisdom that inequality in Poland increased markedly during the economic transition that began in 1989-90. Using micro data from the Household Budget Surveys, we find that, after a brief spike in 1989, income and consumption inequality actually declined to below pre-transition levels during 1990-92 and then increased gradually, rising only moderately above pre-transition levels by 1997. In sharp contrast, inequality in labor earnings increased markedly and consistently throughout the 1990-97 period. We find that social transfer mechanisms, including pensions, played an important role in mitigating increases in both overall inequality and poverty. We argue that, from a political economy perspective, transfer mechanisms were well-designed to reduce political resistance to market-oriented reforms in the early years of transition, paving the way for rapid growth. Finally, we provide cross-country evidence from the transition economies that is consistent with our interpretation of the Polish experience and is also consistent with recent work in growth theory which suggests that redistribution that reduces inequality can enhance growth.

Decoherence suppression by uncollapsing

We show that the qubit decoherence due to zero-temperature energy relaxation can be almost completely suppressed by using the quantum uncollapsing procedure. To protect a qubit state, a partial quantum measurement moves it towards the ground state, where it is kept during the storage period, while the second partial measurement restores the initial state. This procedure preferentially selects the cases without energy decay events. Stronger decoherence suppression requires smaller selection probability; a desired point in this trade-off can be chosen by varying the measurement strength. The experiment can be realized in a straightforward way using the superconducting phase qubit.Comment: 4 page

A Computationally Practical Simulation Estimation Algorithm for Dynamic Panel Data Models with Unobserved Endogenous State Variables

This paper develops a simulation estimation algorithm that is particularly useful for estimating dynamic panel data models with unobserved endogenous state variables. The new approach can easily deal with the commonly encountered and widely discussed “initial conditions problem,” as well as the more general problem of missing state variables during the sample period. Repeated sampling experiments on dynamic probit models with serially correlated errors indicate that the estimator has good small sample properties. We apply the estimator to a model of married women’s labor force participation decisions. The results show that the rarely used Polya model, which is very difficult to estimate given missing data problems, fits the data substantially better than the popular Markov model. The Polya model implies far less state dependence in employment status than the Markov model. It also implies that observed heterogeneity in education, young children and husband income are much more important determinants of participation, while race is much less important.Initial Conditions, Missing Data, Simulation, Female Labor Force Participation Decisions

A Computationally Practical Simulation Estimation Algorithm for Dynamic Panel Data Models with Unobserved Endogenous State Variables

This paper develops a simulation estimation algorithm that is particularly useful for estimating dynamic panel data models with unobserved endogenous state variables. The new approach can easily deal with the commonly encountered and widely discussed "initial conditions problem," as well as the more general problem of missing state variables during the sample period. Repeated sampling experiments on dynamic probit models with serially correlated errors indicate that the estimator has good small sample properties. We apply the estimator to a model of married women's labor force participation decisions. The results show that the rarely used Polya model, which is very difficult to estimate given missing data problems, fits the data substantially better than the popular Markov model. The Polya model implies far less state dependence in employment status than the Markov model. It also implies that observed heterogeneity in education, young children and husband income are much more important determinants of participation, while race is much less important.simulation, missing data, initial conditions, female labor force participation