Earnings Mobility and Long-Run Inequality: An Analysis Using Matched CPS Data

In this article we use matched cross sections from the Current Population Survey (CPS) to examine patterns of short-term earnings mobility for the period 1967-91, which we then employ to assess the impact of rising annual individual earnings inequality on inequality over a longer span, First, we find that less-educated individuals and blacks have more instability in their earnings than those who are more highly educated and non-black. Second, short-term mobility levels have not undergone major changes over the time span we examine. Third, our results suggest that long-run inequality (calculated over five years) rose in the latter half of the 1980s. Fourth, important differences exist across demographic groups in long-run inequality trends, with long-term inequality increasing most in the 1980s for less-educated males.     

TIME LIMITS ON WELFARE RECEIPT

Among the changes in U.S. poverty policy coming about from the end of "welfare as we knew it" has been an imposition of time limits on the receipt of federal welfare funds. Yet little is known about the impact this restriction will have. This paper examines welfare dynamics under Aid to Families with Dependent Children to provide a sense of magnitude of the number of families that would have been at risk of exhausting their eligibility for federal funds in the past. In addition, simulation models are employed to assess whether these results are sensitive to changes in key variables, some of which are within the grasp of policy makers, others of which are not. (JEL 13, J1)