Keeping Up With the Joneses: Analyzing the Effect of Income Inequality on Consumer Borrowing

Household debt relative to disposable income increased from 60% in 1980 to 104% at the end of 2003. ‘Buying on credit’ has become so popular that an increasing number of firms generate more profit from financing than from selling their products. In this paper, we show that rising income inequality has substantially contributed to increased consumer borrowing. Income inequality affects all components of total household debt, but the impact is strongest on non-revolving debt (installment loans), which is used to finance the purchase of consumer durables. We argue and provide evidence that the income inequality effect on consumer borrowing is a result of conspicuous consumption. Rising income inequality has forced households with smaller income gains to use debt to keep up their consumption level relative to households with larger income gains.JEL Classification: D12, G29, J31, M30     

Can income inequality promote democratization?

The aim of this paper is to study the effect of income inequality on the probability of democratization, in a panel of 51 transition countries during the period 1960–2008. Using a conditional fixed-effect logit estimation, we find robust results suggesting that income inequality (measured by the Gini index of household’s income inequality) has an inverse—U-shaped relation with the probability of transition from autarchy to democracy. We show that there is a turning point at a level of household’s income inequality equal to a Gini index of 40. When income inequality is below 40, then probability of transition is positively related to inequality, but when inequality is higher, a subsequent increase in inequality decreases the probability of democratization. This is consistent with Acemoglu and Robinson’s theory that shows how transitions are likeliest at moderate levels of inequality, while autocracy is likelier at the lowest and highest levels of inequality.     

江苏省农村金融发展与农民收入结构分析

基于江苏1988-2010年的数据,本文实证分析了江苏省农村金融发展与农民收入结构的关系:从长期来看,江苏农村金融发展规模、效率对农民家庭各项收入的增加都起到了正作用,农村金融发展效率对农民家庭经营性收入的贡献比较突出,而农村金融发展结构对农民家庭各项收入的增加起着较大的负作用;农民工资性收入、转移性及财产性收入的增长在短期内有利于农村金融发展结构的改善,但长期却相反。     

农民收入水平对农村家庭能源消费结构影响的实证分析

本文依据调查资料,利用层次分析法实证分析了农民收入水平对农村家庭能源消费结构的影响,得出结论:农户的收入水平对农村家庭生活用能源种类的选择影响较大,因此不同收入水平的农户家庭能源消费的结构存在较大的差异;人均收入在4000元以下的农户,户用沼气的权系数最大,人均收入超过4000元的农户,液化气的权系数最大;农户的收入越高,对能源的舒适性、便利性、卫生特性的要求越高,农户的收入越低,对能源的经济性则考虑得越多;使用无成本、又便利的户用沼气非常适合在收入水平较低的农村地区推广。     

货币政策的分配效应研究——基于异质性家庭视角

货币政策不仅是应对突发冲击、在短期内迅速实现经济复苏的政策工具,而且具有调节收入分配的功效。通过将异质性家庭和货币政策引入动态随机一般均衡分析框架,文章考察了扩张性货币政策的分配效应。研究发现,降息不仅能够促进李嘉图和经验规则式家庭的消费和就业,而且有助于降低消费不平等和收入不平等。与不考虑不平等因素的货币政策规则相比,考虑消费不平等和收入不平等的拓展规则引致的社会福利损失显著降低。因此,在制定和执行货币政策规则时,不仅应当考虑家庭的异质性,而且应当考虑可能的消费不平等与收入不平等。     

Entrepreneurship and income inequality in southern Ethiopia

This article uses inequality decomposition techniques in order to analyze the consequences of entrepreneurial activities to household income inequality in southern Ethiopia. A uniform increase in entrepreneurial income reduces per capita household income inequality. This implies that encouraging rural entrepreneurship may be favorable for both income growth and income distribution. Such policies could be particularly successful if directed at the low-income, low-wealth, and relatively uneducated segments of the society.     

Die politische Ökonomie wachsender Ungleichverteilung der Einkommen

In dealing with growing income inequality, economists and social scientists have ignored the interdependencies between economic performance, voter turnout and people’s psychological damages and social deprivations. This article emphasises the role of demography for the bargaining power of trade unions and employer associations. It demonstrates the concomitance of full employment and shrinking income inequality and, correspondingly high unemployment and growing income inequality. Due to the decrease in the size of the labour force in Germany since 2005, the gap between higher and lower incomes will soon become smaller, and many economic and social problems can be solved.     

The Impact of Income Inequality on Product Diversity and Economic Growth

The paper presents an empirical analysis of a model of endogenous growth and innovation with unequal incomes and hierarchical consumer demand. The theoretical model predicts a positive impact of income inequality on product diversity. The impact of inequality on per-capita growth may be positive or negative depending upon the assumptions about productivity growth, where the standard assumption that productivity is positively related to product diversity implies a positive impact. In the empirical part, indices for absolute and relative product diversity are calculated from ICP-expenditure data. The empirical evidence shows that a significant positive relationship exists between income inequality and relative product diversity and that the relationship between income inequality and economic growth is negative and significant. The results lead to the conclusion that the diversity-productivity relationship used in new growth theory has to be treated with scepticism.     

Do entrepreneurs really earn less?

Based on large representative German household survey data, we compare incomes of the self-employed with those of paid employees. We find that the entrepreneurial income gap is largest for those holding a tertiary degree, but in two directions: positive for employers (self-employed with further employees) and negative for solo entrepreneurs. Entrepreneurs holding a tertiary degree also face the greatest income variation. However, some solo self-employed earn more than their employed counterparts, in particular those with a university entrance degree as the highest level of education.     

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.     

未被观测经济与居民收入不平等——基于中国省级面板数据的实证研究

未被观测经济（NOE）对经济发展具有诸多影响,但对居民收入不平等的影响尚未引起足够重视。文章基于动态均衡解的劳动报酬模型得到,随着NOE规模扩大,收入不平等程度（即劳动者从事NOE部门的报酬与从事可观测部门的报酬之差）呈现单调递增的变化过程,但边际变化率先增后减。当考虑劳动者决策的随机动态调整因素时,NOE规模与收入不平等之间存在高低两个动态变化均衡点。在该模型基础上,基于2000-2010年中国省级面板数据,证实了NOE规模与居民收入不平等之间存在显著正向影响关系,人力资本水平、市场化程度和腐败水平也与居民收入不平等呈正向影响关系,而城市化水平则呈较显著的负向影响关系。基于实证结果,提出了相关的政策建议,并对未来研究方向进行展望。     

Do types of foreign capital matter for income equality?

We investigate the link between financial integration and income inequality, suggesting that different channels of financial integration have contrasting distributional effects. Using an unbalanced panel of 65 countries from 1992 to 2015 and employing dynamic panel data methods, we find that greater financial integration through debt-creating capital increases income inequality compared to equity-type capital. Furthermore, a larger share of direct investment in financial integration is associated with lower income inequality; the converse is true for loans and credit, while the share of portfolio investment has no significant effect when considered as a whole. Evidence also shows that increased financial integration and trade is beneficial for reducing the income inequality of emerging economies.     

中国收入差距中的机会不均等

本文使用中国综合社会调查(CGSS)数据和基于回归方程的分解方法,将全国、城镇和农村地区的收入差距分解为源于环境因素的机会不均等、源于努力因素的收入不均等,以及源于运气和未知因素的收入不均等三大成分,研究结果如下。(1)2010—2015年,全国、城镇和农村机会不均等均经历了先上升后下降的过程,但出生时户籍的贡献度有上升趋势。(2)通过估算,2010年我国机会不均等为24.39%,2012年为28.04%,2013年达到峰值35.72%,2015年下降到30.56%,而如果不考虑党员身份、迁移两个努力变量以及环境变量与努力变量的交互影响,估算结果会被高估至少8个百分点;居住地、性别、出生时户籍是机会不均等的重要来源。(3)2010—2015年,农村机会不均等平均水平达到33.31%,高出城镇约8个百分点。其中,年龄与性别因素是导致农村机会不均等过高的原因,而居住地差异是城镇机会不均等的主要来源。基于此,本文建议从协调区域发展、完善就业公平竞争机制、加快户籍制度改革三个方面减缓机会不均等。     

Managerial Behavior of Young Families in Pursuit of Single-Family Home Ownership

The managerial behavior of young families in the pursuit of home ownership was explored with a sample of 1267 households from northwestern lowa. Young owners had higher incomes and higher monthly housing expenses than young nonowners, but the percentage of income devoted to housing did not differ between young owners and young nonowners. Young owners did not have a higher number of full-time workers per household than young nonowners. Young owners had higher persons-per-room ratios and had compromised neighborhood accessibility standards, but not housing quality standards. The findings indicate that a high level of monetary resources was a key factor in enabling young families to own a single-family detached dwelling, for there were few important compromises in housing space and quality.     

Child–mother nutrition and health status in rural Kenya: the role of intra‐household resource allocation and education

There exists gender bias in resource ownership in many parts of Kenya with women being more disadvantaged. Resource ownership and control within the household has differential impacts on the health and overall well‐being of male and female members. This paper examines intra‐household resource ownership and how it affects nutrition and health status of household members. Data from a household survey containing detailed gender‐disaggregated information on resource ownership as well as food and anthropometry were collected from a rural Kenyan district and used in the analysis. Results showed that male members of the household had more access to education, income and land than the females. Mothers’ education, household income, frequency of illness and nutrient intake were the most important factors that contributed to the nutritional status of children. The education and household’s economic status were important determinants of child morbidity. Malnutrition and poor health of children and women is linked to the existing poverty in the study region, therefore emphasis needs to be put on eradication of discrimination against women in accessing education and accessing land, which will contribute to an increase in household incomes. Government policies need to focus on promotion of nutrition education through adult education programmes and incorporating it in the school curricula. Improvement of health‐care facilities in rural areas is also paramount to improving health and nutrition in these areas.     

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.     

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.     

Debt as a source of financial stress in Australian households

This paper examines the role of demographic, socio‐economic and debt portfolio characteristics as contributors to financial stress in Australian households. The data are drawn from the most recent Household Expenditure Survey and relate to 3268 probability‐weighted households. Financial stress is defined, among other things, in terms of financial reasons for being unable to have a holiday, to have meals with family and friends, to engage in hobbies and other leisure activities, and general money management. Characteristics examined include family structure and composition, source and level of household income, age, gender and marital status, ethnic background, housing value, debt repayment of various types and credit card usage. Binary logit models are used to identify the source and magnitude of factors associated with financial stress. The evidence provided suggests that financial stress is higher in families with more children and those from ethnic minorities, especially when reliant on government pensions and benefits, and lower in families with higher disposable incomes and housing values. There is weak evidence that Australia's historically high levels of household debt cause financial stress.     

Would Freeing Up World Trade Reduce Poverty and Inequality? The Vexed Role of Agricultural Distortions

Trade policy reforms in recent decades have sharply reduced the distortions that were harming agriculture in developing countries, yet global trade in farm products continues to be far more distorted than trade in non‐farm goods. Those distortions reduce some forms of poverty and inequality but worsen others, so the net effects are unclear without empirical modelling. This article summarises a series of new economy‐wide global and national empirical studies that focus on the net effects of the remaining distortions to world merchandise trade on poverty and inequality globally and in various developing countries. The global Linkage model results suggest that removing those remaining distortions would reduce international inequality, largely by boosting net farm incomes and raising real wages for unskilled workers in developing countries, and would reduce the number of poor people worldwide by 3 per cent. The analysis based on the Global Trade Analysis Project model for a sample of 15 countries, and nine stand‐alone national case studies, all point to larger reductions in poverty, especially if only the non‐poor are subjected to increased income taxation to compensate for the loss of trade tax revenue.     

对外贸易与收入不平等——基于我国的经验研究

本文采用我国1985-2005年的时间序列数据,就对外贸易与收入不平等的关系进行了实证研究。发现对外贸易与收入不平等是一种倒"U"形的关系。1985-2004年对外贸易拉大了我国的收入不平等,之后则缩小了收入不平等。在此基础上,分析了对外贸易与收入不平等成倒"U"形关系的成因,并就今后发展对外贸易与缩小收入不平等提出了相关建议。