CHANGING INCOME DISTRIBUTION UNDER DEVELOPMENT: COLOMBIA

This paper examines the available evidence relative to the distribution of income in a developing country, Colombia, over a relatively long span of years, roughly from the mid-30s to the mid-60s, especially in the context of the argument that recent growth has been characterized by worsening distribution and stable or declining incomes for lower income groups. The basic conclusions are that income distribution within agriculture worsened throughout the period, while non-agricultural income probably worsened from the mid-30s to the early 50s, improved from then to the mid-60s, and then leveled off. During the period of improvement in non-agricultural income, it appears that the overall distribution also improved somewhat. Over the period as a whole, the main gainers have been the second and third deciles from the top; the top decile appears to have lost. The bottom two deciles also appear to have lost.     

RELATIVE INCOME DETERMINATION IN THE UNITED STATES: A SOCIAL ACCOUNTING PERSPECTIVE

The disaggregated nature of a Social Accounting Matrix makes it a suitable tool for studying the income generation process and its distributional effects. Using the linear structure of a SAM, a model for distributional analysis is developed. The proposed approach emphasizes the functional determinants of relative incomes and the underlying structural features of income distribution and redistribution.     

LABOR INCOME INDICES DESIGNED FOR USE IN CONTRACTS PROMOTING INCOME RISK MANAGEMENT

We propose that labor income indices be used to define settlements in many contracts, such as labor contracts, indexed bonds, or income securities. We discuss the issues in producing labor income indices for such uses, and develop prototype indices using US. data from the Panel Study of Income Dynamics (PSID). People are grouped by a clustering algorithm based on an estimated transition matrix between jobs, by education level, and by skill category. The groupings are defined so that few people move between them. For each grouping we generate a labor income index (1968–87) using a hedonic repeated-measures regression method. The indices show substantial variability through time, confirming the potential importance of the use of such indices in contracts. There is also substantial variability across groupings, as for example between the agriculture/labor grouping and other groupings, confirming the importance of using the grouping indices rather than aggregate indices in contracts.     

CATHOLIC-PROTESTANT INCOME DIFFERENCES IN NORTHERN IRELAND

The purpose of this paper is to analyse income differences betweeen Catholic and Protestant families in Northern Ireland (NI) using Family Expenditure Survey micro-data. The paper's first conclusion is that there is much greater inequality within the Catholic and Protestant communities than there is between them. It's second conclusion, based upon econometric analysis of data for full-time employees, is that the lower mean income of Catholics, relative to Protestants, could be entirely explained in terms of different rates of reward attached to a given set of labour market characteristics.     

THE COST OF INCOME REDISTRIBUTION IN AUSTRALIA

This paper analyses the effect of raising effective marginal tax rates on the income of the representative household in each gross income decile in Australia by one percentage point, and distributing the proceeds of the tax increase either in the form of an equal grant, or as an equal payment to members of households in the lower half of the income distribution. The effectiveness of the program in redistributing income is measured as the ratio of total gains in disposable income to households in target deciles to losses in non-target groups, or as the proportional reduction in the poverty gap. The cost is measured as the ratio of the sum of the income-equivalent of changes in the welfare of non-target groups to those of target groups, or as the ratio of income-equivalent losses to gains.     

FACTORS IN CANADA-UNITED STATES REAL INCOME DIFFERENCES

This paper is a part of a larger study of economic growth in Canada, following the methods developed by Edward Denison in his book The Sources of Economic Growth in the United States and the publication Why Growth Rates Differ. The new material in this paper relates to Canada and the Canadian/U.S. comparison, while the material on Northwest Europe is drawn from the Brookings study. The present paper sets out the results to date on the differences in real output per employed person between Canada and the United States for one year, 1960. At this stage in our research the results indicate that the level of real output per employed person in Canada was about 20 per cent lower than in the United States in that year. On the basis of historical output data, it would appear that this margin of difference in Canadian/U.S. product levels has persisted throughout the present century. The central part of this paper examines the significance of differences in factor inputs in Canada and the United States and their contribution to the difference in income. The level of inputs per employed person in Canada accounts for only about 2 percentage points of the income difference between Canada and the United States. These results indicate that the overwhelming part of the difference in output per employed person between the two countries reflects the differences in output in relation to total factor inputs, rather than the magnitude of other factor inputs used in combination with labour. This result is consistent with earlier studies by Denison and others which have indicated the crucial importance of output in relation to total factor inputs, both in output growth over time and intercountry comparisons of output level. The body of the paper can give only brief attention to the numerous conceptual and statistical questions that arise in such a wide-ranging study, and the authors do not pretend to have tackled, let alone resolved, all of the wide range of problems related to this study. Nor do they claim any high degree of precision for the results, especially in the light of the statistical limitations of the basic data.     

INTERTEMPORAL COMPARABILITY OF NATIONAL INCOME IN CZECHOSLOVAKIA

The national income and product account (United Nations concept) in current prices itemized by distributive shares and by type of expenditure is given for the period 1929–1937. The national income by industrial origin and the reproducible national wealth are computed for the year 1930. Differences between the U.N. and the material concept are explained by means of the 1939 data.
The national product series in real terms are computed (a) by means of the price deflation of the types of expenditure, and (b) as the physical output of goods and services by industrial origin (since 1926). Major changes In distributive shares are explained with the help of Price-cost analysis.
The national product in real terms attains the lowest point in 1935 and not in 1933, as the industrial production and foreign trade series indicate. The structure of gross national expenditure reveals the same pattern of shifts, as is well known from other industrially developed countries during the business cycle.
The development of national product by industrial origin, however, reveals some conspicuous singularities. Especially the uninterrupted increase in trade services (in terms of both persons engaged and turnover in constant prices) is an anomaly in the period of 1929–1937.
Further, the Increase of rent (due to the gradual abolition of rent control), contrasting with the general fall of prices, led to a major shift in the distribution of national income during the early thirties. The other remarkable change resulting mainly from the changing price structure was the decrease of the farmers' share in national income.
The production, transportation and distribution series in real terms reveal some time-lags. These result partly from the shift from the foreign to the home market, partly from the compensatory effects of stock movements, and partly from the delayed adjustment of consumers to declining income.