The Distribution of U.S. Income and Food Expenditures

Food expenditure and income distributions over 1980–1985 are examined using two welfare criteria: less inequality and more available resources. Intertemporal changes in the distributions are studied from the perspectives of inequality, relative economic affluence, society's satisfaction with the distributions, asymmetries, and average propensities to spend. Major conclusions are that inequality has increased over time in both the income and food spending distributions, relative economic affluence has generally risen, society is less satisfied with the food spending distribution, and average propensities to spend on food have been constant.     

Wealth and Income Inequality: An Economic and Ethical Analysis

I perform an economic and ethical analysis on wealth and income inequality. Economists have performed many statistical studies that reveal a number of, often contradictory, findings in connection with the distribution of wealth and income. Hence, the statistical findings leave us with no better knowledge of the effects that inequality has on economic progress. At the same time, the existing theoretical results have not provided us with a definitive answer concerning the effects of inequality on progress. By gaining knowledge of the nature of inequality, and bringing basic economic principles to bear on the subject, we can come to an understanding of what the causal relationship is between inequality and economic progress. Furthermore, I apply a new theory of ethics – rational egoism – to assess economic inequality. I show that, in the right context, economic inequality is both economically and morally desirable.     

Causes of Changing Inequality in the World

To come up with a theory that explains inequality and that has common application across many countries, we need measurements of inequality across countries and through time that are reasonably comprehensive and reasonably reliable — and this is a major challenge. For most countries in the world today, growth reduces inequality, and rich countries are more egalitarian than poor ones. However, there are exceptions. While global financial forces and changing financial conditions have played a powerful role affecting economic inequalities, there does not appear to be a single permanent trend to inequality.     

Inequality in Europe: What can be done? What should be done?

As economic inequality in Europe has continued to rise, it has become the subject of increasing academic attention. What are the drivers of inequality? How does it affect intergenerational economic and social mobility? At what point does inequality become a drag on economic growth or a threat to social order? What economic policy tools are available to reduce inequality? This Forum addresses these and other aspects of this complex and disturbing trend. Case studies of Ireland, Germany and Spain also highlight the impact of economic inequality on individual member states.     

Einkommens- und Vermögensverteilung — zu ungleich?

The distribution of income and wealth in Germany grew increasingly unequal until the beginning of the financial crisis. But inequality has not risen in either Germany or Switzerland since 2005. Nevertheless, Germans overestimate inequality. The German gap between reality and perception of inequality is important to investigate, as the subjective assessment of inequality influences redistribution preferences. Rising inequality may damage social stability and democracy, but it is unclear whether economists are able to assess a “proper and just” distribution. Interdependencies are discussed: Does a more equal distribution create negative effects on economic growth? How does Germany rank internationally with regard to distribution? Social mobility rates differ substantially across countries; what are the implications for economic policy?     

Wealth Inequality and the Great Recession

The study of wealth and wealth inequality has received far less attention than income, but the increasing importance of wealth, debt and wealth inequality means closer attention must be paid to their concomitant dynamics. Policy interventions to reduce economic inequality continue to target income more than wealth, but targeting the latter – especially through taxes on financial assets – is arguably more effective.     

Deutschlands hohe Ungleichheit verursacht wirtschaftlichen Schaden

“Welfare for everyone”, according to former chancellor and economics minister Ludwig Erhard, has been the credo of Germany’s economic and social policy for the past 60 years. However, Germany is increasingly failing to achieve this objective.Germany is a country of enormous inequality – income, wealth and opportunities are distributed more unequally in Germany than in almost any other industrialised country. This inequality imposes huge economic costs for Germany, as evidenced by lower economic growth and declines in other indicators of well-being. And it has triggered a harmful fight among groups of society for public resources. This fight will further intensify with the dramatic changes Germany is currently undergoing, from demographic change to globalisation to the migration challenge. The main culprit for the high and rising inequality is not a lack of public redistribution of income and wealth, but rather the unusually high inequality of opportunity, through which an ever higher share of citizens is deprived of the chance to develop and use their talents and skills. Such barriers have become massive, beginning already in early childhood.     

When the American dream fails: The effect of perceived economic inequality on present-oriented behavior

Economic inequality is worsening worldwide and is associated with various social problems. Although research on inequality has been conducted in various academic fields, research on how perceived inequality affects individual decision making is relatively limited in the marketing field. Recognizing this gap, this study examines how perceived economic inequality can affect individual behavior and decision making from the perspective of time frame. The results of four studies reveal that perceived economic inequality can induce present-oriented behavior and suggest that perceived economic mobility accounts for this relationship. This study demonstrates that present-oriented and shortsighted behaviors, which are usually considered characteristics of the poor, can occur due to the perceptions of the environment beyond class. It implies that the macro level of economic inequality can influence an individual's decision making at the micro level.     

收入不平等对经济增长的负面影响机制——近二十年文献综述

近年来,国内外学者运用各种方法探讨了收入不平等与经济增长的关系。大部分研究结论显示,收入差距对经济增长存在间接的负面影响,两者之间存在一个多因素的传导过程,包括人力资本积累机制、政治经济决策机制、社会冲突机制、需求传导机制以及其他传导机制。总的来看,这些研究加深了对于两者关系性质和相互影响的认识,但研究结论的分歧和研究方法的局限性仍然存在,有必要对两者关系进行更深入的研究。     

Relative Intragenerational Economic Mobility: A Cross-Period Analysis from 1968 to 2009

Recent debate about income inequality has occurred with good reason, as changes in income inequality are critically important for long-term economic prosperity, business profitability, and particularly for the quality and accessibility of labor in the market today. However, what is equally important and less discussed is economic mobility, or the capacity of an individual or a family to improve their financial standing, specifically as it relates to income and wealth. In this paper, we examine statistics on economic mobility in the United States. Our findings suggest that while economic mobility still exists, the likelihood of a household making a large jump out of poverty and into wealth declined from 1999 to 2009. The message of our findings to policymakers is that, rather than a redistribution of wealth from the top of the income distribution to the bottom, what is really needed is broader access to affordable education, better essential nutrition, more stable early childhood development experiences, and basic financial literacy training for all income groups.     

城乡收入差距与经济增长关系的实证研究——基于中国1978—2007年数据的协整检验与脉冲响应分析

对中国1978—2007年数据的实证研究结果表明：城乡收入差距与经济增长之间存在着长期稳定的双向因果关系：城乡收入差距只在短期内对经济增长产生影响;而经济增长并不会自动导致城乡收入差距的缩小,相反,经济增长在中长期内还会进一步加大城乡收入差距。     

When is economic inequality justified?

In the last decade, scholars in the field of organization and management studies have expressed much interest in responding to economic inequality–a phenomenon that led to what some commentators label the crisis of capitalism. While engagements with this topic offered important insights into how organizations are implicated in the propagation of economic inequality, researchers have not yet sufficiently considered the broader, though equally as pertinent, normative question: When is economic inequality justified? This article uses John Rawls’ theory of justice to respond to this question and contends that Rawls provides the philosophical foundation from which to consider the conditions under which economic inequality could be considered fair and just. To animate its conceptual ideas, I present shared capitalism as one form of arranging compensatory systems in contemporary labor relations that would maintain economic inequality, though in a way that would be consistent with Rawls’ conception of justice.     

Soziale Marktwirtschaft – das Fundament für Wachstum und Gerechtigkeit

Among all G20 countries, Germany has the lowest level of inequality in terms of disposable income. Germany’s tax and transfer system – which has a strong and effective redistributive impact compared with other countries – plays a key role in this connection. Over the past ten years, positive growth and employment trends have significantly improved opportunities for economic participation and have put a stop to previous trends towards greater income inequality. In order to safeguard efficient growth and redistributive policies in the future, it is essential for Germany to maintain sufficient incentives for investment, innovation and employment. Political reform strategies to ensure equality of opportunity should aim to achieve a more broad-based accumulation of private wealth and to strengthen labour force participation. The promotion of lifelong education and training, and the economic and social application of the knowledge created in this process, will play a decisive role in achieving these objectives.     

The income inequality,financial depth and economic growth nexus in China

Income inequality has increased in China despite rapid economic growth. Income inequality could impinge on future development, leading to social tension or political instability. Our study investigates the short-run and long-run relationship between three important macroeconomic indicators—income inequality, economic growth and financial depth. We utilise a two-step procedure of ARDL bounds and Granger causality for the analysis. The bounds test indicates the presence of a cointegrating relationship between income inequality, financial depth and economic growth in the long run. In the second step, we utilise the Granger causality approach. Results show a bidirectional causality between financial depth-growth and a unidirectional causality between inequality-growth in the short run. In the long run, results reveal that growth and financial depth determine Gini. Our findings provide support for the inequality-widening effect due to economic growth and higher credit provided to the private sector. We find no evidence of inequality-narrowing or income-equalising effect in the long run for the period of study. It is possible that the government's inclusive growth policies which started less than a decade ago have not taken effect for us to capture the inverted U-shape income equalising effect significantly.     

Immeasurable inequality in the European Union

Over time, the European Union has acquired more and more of the attributes of a state and, in economic terms, it can arguably be considered a single market. Nevertheless, the differences between member states are enormous. Small, rich countries, such as Luxembourg, contrast sharply with big, poor ones, such as Romania. Despite this, many indicators are published which refer to the EU as a whole, including measures of income inequality. According to Eurostat1, the ratio between the incomes of the top and bottom quintiles is 5. But is this figure even roughly adequate? This paper will argue that it vastly underestimates the true level of inequality in the EU which, unfortunately, is immeasurable in the twofold sense that it is both hard to measure and extremely high.     

Does economic globalisation affect income inequality? A meta-analysis

A large volume of econometric literature has studied the impact of economic globalisation on income inequality around the world. However, reported econometric estimates vary substantially, which makes it difficult to draw valid conclusions. This paper presents a quantitative summary and analysis of existing estimates regarding the globalisation–inequality relationship. We use a new data set consisting of 1,254 observations from 123 primary studies. By applying meta-analysis and meta-regression methods, we obtain several main findings. First, globalisation has a (small-to-moderate) inequality-increasing effect. Second, while the effect of trade globalisation is small, financial globalisation shows a more sizeable and significantly stronger inequality-increasing impact. Third, we find an average inequality-increasing impact of globalisation in both advanced and developing countries. Fourth, education and technology moderate the impact of globalisation on income inequality.     

Time to Close the Opportunity Gap

Our economy suffers from a large and widening “Growth Gap” between the current recovery, which started in June 2009, and an average post-1960 recovery. In this context, President Obama raised the issues of economic inequality and mobility. In the United States over the last few decades, income inequality increased modestly, but economic mobility remained stable. First, this address presents five areas in which the federal government can help to ameliorate economic inequality and enhance economic mobility. They concern the federal tax system, the Federal Reserve’s dual mandate, federal unfunded liabilities, and regulatory reform. Second, Congress has a role to play in education reform and reducing the burden of college debt. Third, increasing economic mobility requires Congress to address the “poverty traps” for low-income individuals that are imposed by the interaction between taxes and the eligibility for social welfare benefits. Fourth, as a society, we must encourage the young to get their first job, a problem made worse by the proposed increase in the federal minimum wage. Fifth, we must open new markets for exports.     

Inequality and entrepreneurial thresholds

We explore the relationship between inequality and entrepreneurial activity. Drawing on cross-sectional data from a largescale survey of the economic conditions of individuals across India, we develop a number of dimensions of inequality to explore empirically how inequality interacts with entrepreneurship, operationalized as self-employment or as employing other people. We find compelling evidence that there are thresholds to becoming self-employed, and even more so to assembling the combinations of resources and personal attributes required to become an employer. Greater inequality leaves more people unable to make the transition to self-employment, leaving casual laboring as the occupation of necessity. At the same time, inequality increases the number of employers in a society, by concentrating resources - particularly land and finance - enough for significant numbers of people to be able to cross this higher threshold. Lastly, greater differentiation into social or religious groups curtails the ability to cross either entrepreneurial threshold, presumably by limiting the extent and benefits of social networks of value for entrepreneurship.     

The Erosion of the German Middle Class

Since the mid-1990s, income inequality has increased more sharply in Germany than in many other European countries, as the economic basis of middle-class prosperity and security has crumbled. The new minimum wage, an increase in coverage by collective agreements, the re-regulation of atypical employment forms and the elimination of incentives to take marginal, part-time jobs are the keys to strengthening the middle-income groups in Germany.