Book Chapter•
Income inequality and income mobility
01 Jan 2007-pp 2275-2277
About: The article was published on 2007-01-01 and is currently open access. It has received 119 citations till now. The article focuses on the topics: Income distribution & Income inequality metrics.
Citations
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TL;DR: This article used Social Security Administration longitudinal earnings micro data since 1937 to analyze the evolution of inequality and mobility in the United States and found that long-term mobility among all workers has increased since the 1950s but has slightly declined among men.
Abstract: This paper uses Social Security Administration longitudinal earnings micro data since 1937 to analyze the evolution of inequality and mobility in the United States. Annual earnings inequality is U-shaped, decreasing sharply up to 1953 and increasing steadily afterward. Short-term earnings mobility measures are stable over the full period except for a temporary surge during World War II. Virtually all of the increase in the variance in annual (log) earnings since 1970 is due to increase in the variance of permanent earnings (as opposed to transitory earnings). Mobility at the top of the earnings distribution is stable and has not mitigated the dramatic increase in annual earnings concentration since the 1970s. Long-term mobility among all workers has increased since the 1950s but has slightly declined among men. The decrease in the gender earnings gap and the resulting substantial increase in upward mobility over a lifetime for women are the driving force behind the increase in long-term mobility among all workers.
546 citations
Cites background or methods from "Income inequality and income mobili..."
...The annual samples are selected based on a fixed subset of digits of the transformation of the Social Security Number....
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...Shorrocks (1978) shows that (Theorem 1a, p. XX): G(z̄) ≤ K∑ t=1 G(zt)/K, where zt is the vector of earnings in period t and z̄ the vector of average (across periods) earnings....
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...Therefore, conceptually, a way to measure mobility (Shorrocks, 1978) is to compare inequality of short-term earnings to inequality of long-term earnings and define mobility as: (1) Long-term earnings inequality = Short-term earning inequality * (1 - Mobility) Alternatively, one can define mobility…...
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TL;DR: In this paper, the authors estimate trends in intergenerational economic mobility by matching men in the Census to synthetic parents in the prior generation, finding that mobility increased from 1950 to 1980 but has declined sharply since 1980.
Abstract: We estimate trends in intergenerational economic mobility by matching men in the Census to synthetic parents in the prior generation. We find that mobility increased from 1950 to 1980 but has declined sharply since 1980. While our estimator places greater weight on location effects than the standard intergenerational coefficient, the size of the bias appears to be small. Our preferred results suggest that earnings are regressing to the mean more slowly now than at any time since World War II, causing economic differences between families to become more persistent. However, current rates of positional mobility appear historically normal.
239 citations
TL;DR: Gender- and age-related changes in sexual orientation identity from early adolescence through emerging adulthood in 13,840 youth ages 12–25 employing mobility measure M, a measure modified from its original application for econometrics is described.
Abstract: This study investigated stability and change in self-reported sexual orientation identity over time in youth. We describe gender- and age-related changes in sexual orientation identity from early adolescence through emerging adulthood in 13,840 youth ages 12–25 employing mobility measure M, a measure we modified from its original application for econometrics. Using prospective data from a large, ongoing cohort of U.S. adolescents, we examined mobility in sexual orientation identity in youth with up to four waves of data. Ten percent of males and 20% of females at some point described themselves as a sexual minority, while 2% of both males and females reported ever being “unsure” of their orientation. Two novel findings emerged regarding gender and mobility: (1) Although mobility scores were quite low for the full cohort, females reported significantly higher mobility than did males. (2) As expected, for sexual minorities, mobility scores were appreciably higher than for the full cohort; however, the gender difference appeared to be eliminated, indicating that changing reported sexual orientation identity throughout adolescence occurred at a similar rate in female and male sexual minorities. In addition, we found that, of those who described themselves as “unsure” of their orientation identity at any point, 66% identified as completely heterosexual at other reports and never went on to describe themselves as a sexual minority. Age was positively associated with endorsing a sexual-minority orientation identity. We discuss substantive and methodological implications of our findings for understanding development of sexual orientation identity in young people.
193 citations
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01 Jan 2013
TL;DR: In this article, the authors survey the literature on income mobility, aiming to provide an integrated discussion of mobility within and between-generations, and review mobility concepts, descriptive devices, measurement methods, data sources, and recent empirical evidence.
Abstract: We survey the literature on income mobility, aiming to provide an integrated discussion of mobility within- and between-generations. We review mobility concepts, descriptive devices, measurement methods, data sources, and recent empirical evidence.
156 citations
Cites background or methods from "Income inequality and income mobili..."
...It has been found as an empirical regularity, from Shorrocks (1981) onwards, that using different indices can make a big difference to the estimates of R derived and also that the Gini coefficient tends to show greater R values than other inequality indices....
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...Evidence about sibling correlations in earnings (and income) was surveyed by Solon (1999), Björklund and Jäntti (2009), and also by Schnitzlein (2013), who provides new estimates for Denmark, Germany, and the USA....
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...The normalized trace is the Shorrocks (1978b) index calculated from the decile transition matrix....
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...The Equalization indices are those of Shorrocks (1978a) and Fields (2010)....
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...A more detailed examination of these two facets of mobility will provide a better understanding of the impact of income variability and the implications for social welfare (Shorrocks, 1978a, 392–393)....
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TL;DR: This article developed a new class of measures of mobility as an equalizer of longer-term incomes, a concept different from other notions such as mobility as time-independence, positional movement, share movement, income flux, and directional income movement.
Abstract: This paper develops a new class of measures of mobility as an equalizer of longer-term incomes—a concept different from other notions such as mobility as time-independence, positional movement, share movement, income flux, and directional income movement. A number of properties are specified leading to a class of indices, one easily-implementable member of which is applied to data for the USA and France. Using this index, income mobility is found to have equalized longer-term earnings among US men in the 1970s but not in the 1980s or 1990s. In France, though, income mobility was equalizing throughout, and it has attained its maximum in the most recent period.
150 citations
References
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TL;DR: In this article, the first application of the local approximation method for the Shorrocks mobility indices across the earnings distribution for a range of European Countries covering the main European social models: Denmark, Germany, Spain, the UK and Italy in the preaccession EU (1994-2001).
Abstract: This paper offers the first application of the local approximation method pioneered by Schluter and Trede (2003) for the Shorrocks mobility indices across the earnings distribution for a range of European Countries covering the main European social models: Denmark, Germany, Spain, the UK and Italy in the pre-accession EU (1994-2001). This insightful approach allows us to offer a global and disaggregate analysis of mobility as proportionate change in inequality and hence provide the reader with a full set of information to make his/her own judgment about the extent of mobility and country ranking. Specifically, we investigate the degree to which mobility is driven by low or high earners and how this picture changes across three different earnings measures: full-time full-year working, adding part-time working and then part-year working.
Our results draw out some general key facts. First of all the vast bulk of the measured mobility occurs in the tails especially the lower tail with at least half of the index driven by mobility in the bottom earning quintile. Second, in the top 20 percent of the distribution there are few movements of earnings that effect the level of permanent inequality except in Denmark. Third, no country has a clear dominance for mobility across the full earnings distribution but Denmark differs from the other countries with clearly greater mobility in the middle and at the top. Finally, we find that with the exception of Denmark and Italy, mobility does not lead to clear convergence to the mean but rather to points around 0.7-0.8 and 1.5 to 2 times the mean.
5 citations
Posted Content•
TL;DR: The authors argue that the movie encompasses the snapshot and is normatively superior as the basis for assessing policy, and that the snapshot itself often contains the seeds of the movie, as posited in the Great Gatsby Curve.
Abstract: The conventional justification for moving from income distribution to intergenerational mobility analysis is that the movie encompasses the snapshot and is normatively superior as the basis for assessing policy. Such a perspective underpins many an argument for shifting the focus from income redistribution, which is said to equalize outcomes, to equalizing opportunity by increasing mobility through such policies as equal provision of public education. This paper argues that this perspective can be misleading. It shows that normative evaluation of mobility in any event often falls back on a snapshot perspective. Further, the snapshot itself often contains the seeds of the movie, as posited in the Great Gatsby Curve. Income redistribution can itself improve mobility even if that is the only objective. The paper thus speaks in praise of snapshots.
4 citations
01 Jan 2011
TL;DR: In this paper, the authors ponuditi pregled istraživanja mobilnosti prihoda, and uglavnom divergentan proces u zemljama jugoistocne Europe (SSE) and u EU u periodu od 1990-2009.
Abstract: Cilj rada je ponuditi pregled istraživanja mobilnosti prihoda. U tu svrhu smo prije svega saželi cesto koristene pojmove i odgovarajuce mjere u tri grupe, odnosno, kretanje, vremenska ovisnost i izjednacavanje prihoda. Nakon toga, s obzirom da je jedinica analize država, reformulirali smo indikatore mobilnosti kako bismo u obzir uzeli velicinu država. Zatim, u empirijskom pristupu uspoređujemo mobilnost prihoda u zemljama jugoistocne Europe (SSE) i u EU u periodu od 1990-2009. Rezultati ukazuju da je, dugorocno gledano, mobilnost prihoda veca u jugoistocnoj Europi nego u EU. Ipak, u posljednjem je desetljecu bilo obrnuto. Osim toga, mobilnost prihoda je uglavnom divergentan proces u zemljama jugoistocne Europe, dok EU bilježi konvergentnu mobilnost. Povrh svega, za razliku od EU, u zemljama jugoistocne Europe mobilnost prihoda pokazuje neujednacene dugorocne prihode tijekom cijelog analiziranog perioda. Stoga ovi rezultati mogu poslužiti kao temelj za donosenje odluka vezanih za politike regionalnog razvoja koje se koriste u procesu europske integracije.
4 citations
TL;DR: In this paper, two views of mobility are considered, either based on measures of absolute mobility or on transition matrices, and tests for stochastic dominance in mobility based on the empirical likelihood ratio are proposed.
Abstract: This paper proposes tests for stochastic dominance in mobility based on the empirical likelihood ratio. Two views of mobility are considered, either based on measures of absolute mobility or on transition matrices. First-order and second-order dominance conditions in mobility are first derived, followed by the derivation of statistical inferences techniques to test a null hypothesis of non dominance against an alternative of mobility dominance. An empirical analysis, based on the US Panel Study of Income Dynamics (PSID), is performed by comparing four income mobility periods ranging from 1970 to 1990.
4 citations
TL;DR: In this paper, a comprehensive study of inequality and mobility patterns for Russia, using multiple rounds of the Russian Longitudinal Monitoring Surveys over the past two decades spanning this transition is presented.
Abstract: The Russian Federation offers the unique example of a leading centrally planned economy swiftly transforming itself into a market-oriented economy. This paper offers a comprehensive study of inequality and mobility patterns for Russia, using multiple rounds of the Russian Longitudinal Monitoring Surveys over the past two decades spanning this transition. The findings show rising income levels and decreasing inequality, with the latter being mostly caused by pro-poor growth rather than redistribution. The poorest tercile experienced a growth rate that was more than 10 times that of the richest tercile, leading to less long-term inequality than short-term inequality. The analysis also finds that switching from a part-time job to a full-time job, from a lower-skill job to a higher-skill job, or staying in the formal sector is statistically significantly associated with reduced downward mobility and increased income growth. However, a similar transition from the private sector to the public sector is negatively associated with income growth.
4 citations