Transcript Class Structure and Household Economic Well

Class Structure and Household
Economic Well-Being
Ed Wolff
Ajut Zacharias
Discussant: Stephan Klasen.
1
Summary 1
• Purpose of Paper: Investigate inequality within and
between „classes“ using comprehensive income measure
for US, 1989 and 2000.
• Concept of Class: Determination by Net worth,
occupational titles, and self-employment: Capitalists (net
worth>$5m.), no compulsion to work, five laboring classes
(managers, supervisors, white-collar skilled, blue-collar
skilled, unskilled), and self.-employed.
• Assignment based on CPS, Annual Demographic
Supplement matched (nearest neighbour) with SCF to
dientify capitalists. Household based but using
characteristics of ‚reference person‘.
• Comment: Where are workless households? Do these
groups have common interests/ agendas/ consciousness?
2
How many capitalists labor?
3
Summary 2
• Chacteristics of ‚reference person‘
– 88% of capitalists white (73% of noncapitalists)
– Gender and age characteristics hard to interpret
and contigent on definition of ‚reference
person‘ (and not so relevant since is it a
household level concept)
– Education characteristics as expected (and
similar problem as above)
4
Summary 3
• Derivation of ‚Comprehensive Income‘ measure:
– Subtracts consumption taxes
– Adds income from wealth (home and non-home) cash
and non-cash transfers. Differences to ‚Extended
Income‘ (Census Bureau):
• Uses annuity value from non-home wealth
• Uses imputed rent on owner-occupied housing (minus
mortgage payments)
• Uses full cost (insurance) value of non-cash transfers
5
6
Summary 4
• Total inequality (Gini) decomposition using
Ytzaki (1994) framework:
7
8
9
Summary 4
• Inequality and Income Sources: Using CI,
capitalists have higher incomes from wealth
and that has increased dramatically 19892000
• Gini decomposition by income shows rising
inequality in CI driven by that (rising
inequality in EI driven by contribution from
base, i.e. money, income).
10
Comments
• Nice paper, lots of good empirical work, careful data
analysis;
• Why is class a useful concept (other than history of
thought relevance)? (But how useful is quintile?)
• Ytzaki decomposition not very intuitive and ‚overlap term‘
a form of between-inequality?
• Using Theil decompositions to show that between class
term is more significant than other ways to slice the data
(e.g. race, region, education)
• Earnings versus household income: class based on labor
and earnings, then other incomes added. Problem?
11
Welfare State Expenditures and
the Redistribution of Well-Being:
Children, Elders, and Others in
Comparative Perspective
Irwin Garfinkel, Lee Rainwater, Tim
Smeeding
Discussant: Stephan Klasen.
12
Summary 1
• Purpose of Paper: Measure redistribution by state
including taxes, cash and in-kind benefits in 10
OECD countries.
• Accounting Exercise (abstracting from changes in
behavior, particularly household formation
behavior).
• Base data: after tax LIS data (what about income
from owner-occupied housing?)
• Added: sales, VAT, excise, corporate taxes,
government health and education spending (plus
employer health provisions in US): Taxes forced
to equal expenditures!
13
Summary 2
• Many details on imputations (mostly reasonable,
some open to question) .
• Education: only primary and secondary and
allocated to households with relevant age children;
random allocation of early childhood education.
• Health: public spending allocated in ageincreasing gradient; US: allocation of employerprovided health care.
14
15
16
17
18
Further Results
• Elderly net recipients, childless households
net payers (but large redistribution within
groups)
• Average benefits assumption changes
redistributive role of government the most
for elderly (by construction, main
beneficiaries of large health spending in
US)
19
Comments
• Nice, careful, and comprehensive study;
• High in-kind benefits in US worth as much to recipients?
• What is ‚public health‘ spending in Germany (includes
employer and employee contribution?)
• Tertiary education could (and should) be included using
different household surveys (and published work);
• Many childless households remain childless (33% in
Germany), so permanent not life-cycle subsidy.
• P10/P50 among childed households ‚equality of
opportunity‘ in sense of Roemer (1998) and WDR
(2005)?
20
Income Inequality Across
Regions of Russian Federation
(1995-2003)
Irina Gerasimova
Discussant: Stephan Klasen.
21
Summary 1
• Purpose of paper: describe inequality trends by
regions and income sources from published
sources for Russia;
• Data: published ROSSTAT aggregate data (some
discussion of data inconsistencies with other
sources)
• Describe Gini and income components by region
(78) over time
• Generate deciles of regions (7-8 regions each) to
generate Gini for total money income and income
components
22
23
24
25
26
Comments
• Nice study highlighting importance of regional inequality,
centralitiy of Moscow region, and role of income sources;
• Questions about data reliability (and definitions, e.g. ‚other
incomes‘)
• Within-Russia inequality convergence?
• Table 1/Figure 1 should not use ‚maximum Gini‘ from
WIID database.
• Why first aggregate to regions and then calculate Ginis
(throwing away information)?
• Clear limits to aggregate data: need to investigate this
using micro data (RLMS?) and doing full decompositions.
• More clarifications on terms and concepts needed.
27