TOTAL INCOMES IN THE UNITED STATES, 1946–1976: A SUMMARY REPORT

Extended accounts of total income and product and associated capital stocks for the United States, in current and constant dollars, are offered for the years 1946 to 1976. They include intangible and tangible capital accumulation and non-market and market outputs in all sectors, services of government and household capital and of unpaid household labor, and opportunity costs of students. Defense and police services are classified as intermediate product; a portion of commercial media services is counted as final product. Expenses related to work are subtracted while the values of employee training and human capital formation and net revaluations of existing tangible capital are added.
Total incomes (TISA) net national product was 50 percent greater than official Bureau of Economic Analysis (BEA) NNP in 1976. BEA gross private domestic investment was only about 18 percent of TISA gross capital accumulation. Intangible investment and TISA net domestic capital accumulation grew more rapidly than BEA net private domestic investment. Household investment has been growing while there have been sharp declines in government investment, particularly in research and development. Contrary to some views of the import of the narrower BEA accounts, total capital accumulation appears to have risen considerably more rapidly than total consumption, 6.3 percent versus 2.2 percent per annum from 1946 to 1976, thus increasing sharply its share of TISA GNP.     

CORRUPTION AND INCOME INEQUALITY IN THE UNITED STATES

In this study we analyze the effects of corruption on income inequality. Our analysis advances the existing literature in three ways. First, instead of using one of the corruption indices assembled by various investment risk services, we use an objective measure of corruption: the number of public officials convicted in a state for crimes related to corruption. Second, we minimize the problems which are likely to arise because of data incomparability by examining the differences in income inequality across the United States. Finally, we exploit both time series and cross‐sectional variation in the data. We find robust evidence that an increase in corruption increases income inequality. (JEL D31, D73, I32)     

FAMILIES, TIME AND MONEY IN CANADA, GERMANY, SWEDEN, THE UNITED KINGDOM AND THE UNITED STATES

Using microdata from the Luxembourg Income Study, we assess "time crunch" for families with children in Canada, Germany, Sweden, the U.K. and the U.S. Both theory and empirical evidence suggest that both time and money are important inputs to the well-being of parents and children. We present cross-country comparisons of "total available adult hours" under different assumptions about the varying time needs of families of different size. We also present estimates of "time shortages." In all cases, we provide separate estimates for families located at different points in the country income distributions, since being short of both time and money is likely to be particularly problematic. Although paid work hours are highest for high-income families, we nonetheless find significant numbers of lower-income families in which parents work very long hours in the paid labor market; this is particularly the case in the U.S.     

GENDER WAGE DIFFERENCES IN AUSTRALIA, SWEDEN AND THE UNITED STATES

In this paper I use microdata from the Luxembourg Income Study t s investigate the contributions of industrial structure, occupational mix and personal and family characteristics to observed gender differences in wages in Australia, Sweden and the United States. A particular effort is made to analyse differences in distribution as well as level of wages. The conclusion reached is that different factors determine the wages of low- and high-wage workers. For higher-wage workers, personal and family characteristics are important explanations for wage variation. For lower-wage workers, occupation plays a more significant role.     

FOREIGN TAKEOVERS AND NEW INVESTMENTS IN THE UNITED STATES

This study is unique in several respects. First, it reviews the characteristics of the top 10 industries targeted for foreign direct investment (FDI) activity in the United States between 1979 and 1987. It analyzes both overall FDI activity and new plant and expansion FDI activity. The study summarizes and tests alternative hypotheses regarding the determinants of FDI in the United States by all countries, by the United Kingdom, by the European Community, by Japan, and by Canada.
Large and growing product markets in an expanding economy have attracted FDI in the United States. Exchange rate movements have prompted opportunistic decisions to invest in U.S. production facilities. Investors' superior management skills appear to have prompted takeovers, while efforts to realize technological advantages of new physical capital and of relatively large operating plants have fostered plant and expansion investments.
Evidence exists that a desire to circumvent current—but not potential—trade restrictions has motivated foreign direct investment. FDI activities are not associated with concentrated or heavily unionized industries. Highly protected industries have attracted heavier equity FDI by Japan and heavier new plant FDI by all sources and Canada. No evidence exists that FDI in the United States by Japan or anyone else is targeted to undercut union-dominated firms or to arrest the spread of protectionist trade policies.     

FOREIGN TAKEOVERS AND NEW INVESTMENTS IN THE UNITED STATES

This study is unique in several respects. First, it reviews the characteristics of the top 10 industries targeted for foreign direct investment (FDI) activity in the United States between 1979 and 1987. It analyzes both overall FDI activity and new plant and expansion FDI activity. The study summarizes and tests alternative hypotheses regarding the determinants of FDI in the United States by all countries, by the United Kingdom, by the European Community, by Japan, and by Canada.
Large and growing product markets in an expanding economy have attracted FDI in the United States. Exchange rate movements have prompted opportunistic decisions to invest in U.S. production facilities. Investors' superior management skills appear to have prompted takeovers, while efforts to realize technological advantages of new physical capital and of relatively large operating plants have fostered plant and expansion investments.
Evidence exists that a desire to circumvent current—but not potential—trade restrictions has motivated foreign direct investment. FDI activities are not associated with concentrated or heavily unionized industries. Highly protected industries have attracted heavier equity FDI by Japan and heavier new plant FDI by all sources and Canada. No evidence exists that FDI in the United States by Japan or anyone else is targeted to undercut union-dominated firms or to arrest the spread of protectionist trade policies.     

THE DEMAND FOR BEVERAGES AND INTERBEVERAGE SUBSTITUTION IN THE UNITED STATES

The analysis in this paper is directed at measuring the substitution between seven beverages consumed in the United States with the objective of shedding some light on just what is the relevant market for antitrust purposes. With regard to the overall beverage market considerations, there is a clear indication that consumers do substitute between different types of beverages. What must be subjectively resolved, however, is whether the extent of the indicated substitution is of significant enough magnitude to infer that two different beverages are in the same product market.     

THE FISCAL MULTIPLIER AND ECONOMIC POLICY ANALYSIS IN THE UNITED STATES

The Great Recession sparked wide interest in the economic effects of fiscal policy. That interest is reflected in an ongoing debate over the size of the fiscal multiplier. This survey article addresses three questions: What models do economists use to estimate that multiplier? Why do estimates of it vary widely? How can economists use those estimates to judiciously analyze U.S. economic policy? (JEL E62, H30, H50)     

INFLATION INEQUALITY IN THE UNITED STATES

Different spending patterns across households and differences in price increases across goods and services lead to unequal levels of inflation faced by different households. In this paper we measure the degree of inequality in inflation across U.S. households for the period 1987–2000. The broad picture that emerges from our results is that over our whole sample period there are substantial differences in the inflation experiences across U.S. households. We find that the cost of living increases were generally higher for the elderly, in large part because of their health care expenditures, and that the cost of living of poor households is most sensitive to the, historically large, fluctuations in gasoline prices. Still, when looking at the whole population, we find that individual households that are confronted with high inflation in one year do not generally face high inflation in the subsequent year as well.     

PARTY CUES,POLITICAL TRENDS,AND FISCAL INTERACTIONS IN THE UNITED STATES

Recent theoretical and empirical research has suggested that similarities in party affiliations across space will alter voters' comparisons, thus influencing fiscal policy mimicking. We employ a two‐regime spatial panel data model applied to U.S. state governors from 1970 to 2012, and find rather weak empirical evidence of influence of political party affiliations in fiscal yardstick competition. Our observed cross‐state interdependence in fiscal policies suggests voters may not weigh party affiliation heavily in their measure of comparative quality, treating each incumbent individually and independently. Incumbents strategically choose policy accordingly. This provides indirect support for the median voter theorem, in which incumbents' objective function is to maximize votes, independent of political affiliation. (JEL D72, H2, H7)     

DRUG POLICY AND INTERGENERATIONAL INCOME MOBILITY IN THE UNITED STATES

A conviction for drug possession blocks some of the most common pathways through which individuals from low income families achieve upward economic mobility in the United States, such as access to higher education, entry‐level employment, and military service. These considerations are of growing importance because the number of drug‐related arrests have nearly quadrupled since 1980. This article estimates the effect of a conviction for drug possession on earnings mobility using a sample of individuals born between 1980 and 1984, some of the first cohorts to come of age in the context of intensive U.S. drug criminalization and enforcement. To distinguish the effect of a drug conviction from the effect of drug use or general criminality, I compare mobility among individuals with drug convictions to control groups who self‐report significant drug use and who have had interactions with the criminal justice system that did not lead to a drug conviction. I find that relative to these groups, a drug conviction reduces the probability of transitioning upward from various points in the lower half of the income distribution by 10–15 percentage points, or as much as 50%, and that these effects are substantially stronger for non‐whites than for whites. These findings suggest that a policy of decriminalizing nonviolent drug possession would substantially increase intergenerational mobility among low income populations, and this effect should be weighed alongside more conventional costs and benefits in formulating optimal drug policy. (JEL J38, J15, K42)     

THE STANDARD OF LIVING IN THE UNITED STATES

A common approach to the evaluation of the standard of living is based on a function of real income. In the United States this often takes the form of CPI-deflated mean household income. Material well-being is more appropriately evaluated using a consumption-based index. Using data from the Consumer Expenditure Surveys we find that real mean income provides an inaccurate representation of the level and trend of the standard of living relative to real per equivalent total expenditure in the postwar United States. The differences between real income and real total expenditure per household equivalent member are found at all levels of aggregation.     

COMPARING POST-COLD WAR MILITARY CONVERSION IN THE UNITED STATES AND RUSSIA

According to the conventional wisdom, military conversion in Russia would be more difficult than in the United States because Russia does not have the developed market infrastructure and institutions that help western defense firms redeploy resources for civilian production. A closer look raises doubts about these arguments. Western defense firms have had difficulties with conversion because they cannot compete with the existing relatively efficient civilian firms. Meanwhile, the principal competitors of the Russian defense firms, the large Russian civilian enterprises, are closer in nature to defense enterprises than to efficient market firms. While this does not bode well for the Russian economy in general, the defense enterprises should not find themselves at a significant disadvantage in the civilian markets. Two effects can be distinguished. On the one hand, due to the more developed market infrastructure, the U.S. economy is presumably good at redeploying defense-related resources across firm boundaries. On the other hand, the large and efficient civilian sector in the United States makes the marginal "civilian" value of the redeployed resources low. It is the interaction of these factors, rather than the degree of development of market infrastructure alone, that determines the relative difficulty of military conversion. Additionally, empirical evidence based on regional data indicates that despite enormous defense expenditure cuts, the economic performance of Russia's regions is only relatively weakly correlated with the regions' dependency on defense industry.     

COOPERATIVE RURAL ELECTRIFICATION IN THE UNITED STATES

A most impressive work has been accomplished during the past few years in the United States both by the Federal Authorities and by local bodies in the domain of electrification. Their example might advantageously be followed by the Governments bf many other countries. An essential part of this work is concerned with rural electrification, which presents a most original feature in the considerable rôle allocated to a new organ, the cooperative of rural electrification, whose establishment and operation are given every encouragement by the public authorities.
A very exhaustive and remarkably clear account of the whole system adopted, its practical realisation, and the extent of the work already achieved, has been published by the Pan American Union, Division of Agricultural Cooperation (Washington, D.C.), in its "Series on Cooperatives", No. 15. It is the work of Mr. Udo Rall. It will be of the greatest interest to the readers of the Annals of Collective Economy to have this masterly survey brought before them.
We desire to express our gratitude both to the Division of Agricultural Cooperation and to Mr. Udo Rall for their kindness in allowing us to reprint it.     

TRUE HOUSEHOLD EQUIVALENCE SCALES AND CHARACTERISTICS OF THE POOR IN THE UNITED STATES

In this paper we deal with the question of which measures of economic well-being are adequate to identify those groups of households in the U.S. whose economic conditions justify public concern and assistance. We derive a utility based measure of economic well-being from the estimation of a complete set of consumer demand equations. The demand system is Lluch's Extended Linear Expenditure System (Lluch, 1973). Household characteristics are incorporated using the scaling method proposed by Barten (1966). Using the welfare indicator derived, we study the composition of the poorest part of the population, using data from the 1972–73 Consumer Expenditure Survey. We compare our results with those obtained using various other welfare indicators, including the official U.S. poverty line. We show that using different family composition adjustments significantly and systematically affects just who are considered to be at the bottom of the welfare distribution. We finally suggest that program designers therefore can improve their target efficiency by carefully selecting from among the acceptable indices of welfare when defining program eligibility.