Institutions and the convergence hypothesis: The cross-national evidence

DeLong and others have shown that cross-country convergence in per capita incomes is limited to samples of currently-industrialized nations, or universal-literacy nations. In particular, income dispersion has failed to decline in groups of ex ante rich nations. This study finds strong convergence in per capita incomes among nations with institutions (namely secure property rights) conducive to saving, investing, and producing. Incomes are shown to converge even within ex ante rich samples when measures of institutional quality are held constant.     

Democratic Transitions

Przeworski et al. (2000) challenge the key hypothesis in modernization theory: political regimes do not transition to democracy as per capita incomes rise, they argue. Rather, democratic transitions occur randomly, but once there, countries with higher levels of GDP per capita remain democratic. We retest the modernization hypothesis using new data, new techniques, and a three-way rather than dichotomous classification of regimes. Contrary to Przeworski et al. (2000) we find that the modernization hypothesis stands up well. We also find that partial democracies emerge as among the most important and least understood regime types.     

Incomes of the aged and nonaged, 1950-82

This article discusses the results of previous studies, both supportive and nonsupportive of the conclusion that the aged are as well-off as the nonaged, and then presents a range of figures from Bureau of the Census reports over the period 1950-82 that measure both the incomes of the aged and nonaged and those of subgroups within these populations. Census figures indicate that the aged and nonaged have about equal levels of average per capita family income and that about the same proportions of these groups have incomes below the poverty line. However, aged unrelated individuals, who account for about a third of all aged persons, have less than three-fifths the income of nonaged unrelated individuals. When the per capita family income of the aged is compared separately with that of families headed by persons aged 25-44 and 45-64, aged persons receive more than those under age 45 but less than those aged 45-64. Trends in the economic status of the aged and nonaged over the period 1950-82 indicate numerous fluctuations rather than a consistent improvement in the income of either group in relation to the other.     

On the equity effects of taxing imputed rent: Evidence from Australia

Abstract

Taxation of net imputed rent from owner‐occupied housing (and mortgage interest deductibility) has been advocated in Australia on grounds of both efficiency and equity. The current tax system (no taxation or deductibility) favors owner‐occupied housing over business investments, and in the owner‐occupied sector it favors high‐income, low‐debt households over others. Nevertheless, imputed rent taxation has been criticized on the empirical grounds that its direct burden would fall more heavily on low‐income households than high‐income households.

Using micro‐level data from the 1986 Income Distribution Survey, we show that the burden does not fall more heavily on low‐income households when net imputed rent is included in owners’ incomes and when life cycle effects are controlled for. Moreover, for married couples aged 25 to 54, the taxation of imputed rental income would be not only progressive, but more progressive than the taxation of other household income.     

Congressional tenure: Myth and reality

Congressional tenure is longer now than in earlier times, but it is largely a myth that the era of the professional politician is a modern phenomenon. Here, tenure is compared between the 57th and 86th Congresses. Tenure is linked to a simple median voter model. Increased tenure is associated with an increased ability to transfer government expenditures to the political unit. The increased size of government at the time of the 86th Congress compared to the 57th Congress, largely explains the greater length of time in office. The higher tenure of southern legislators is linked to lower per capita incomes.     

Interjurisdictional redistribution and public goods with increasing returns to scale

This paper builds upon probabilistic voting theory to examine vote maximizing interjurisdictional redistribution with increasing returns to scale in the production of regional public goods. We find that with interregional differences in the per capita cost of public goods, the vote maximizing interregional redistribution will seem incoherent and unfair when judged on the basis of the availability of public goods or regional incomes.     

Unchanging child support orders in the face of unstable earnings

The underlying theory behind child support guidelines implies that child support orders should change when the incomes of noncustodial parents change. This paper documents changes in noncustodial fathers' earnings over a five‐year period and examines the relationship between the changes in earnings and modifications in child support orders. Using detailed longitudinal administrative data from Wisconsin, the authors examine the history of orders and earnings for fathers in couples who had their first child support ordered in 2000. A substantial proportion of fathers experience large changes in earnings, but relatively few of the associated child support orders are modified. Using discrete‐time multinomial event history models that consider time‐varying variables and control for censored observations, we find some evidence of changes in earnings being associated with changes in orders, all else equal, but the relationship is relatively weak and order changes are not proportional to earnings changes. The findings highlight the challenges and importance of developing policies that result in child support orders being more responsive to changes in fathers' incomes. © 2010 by the Association for Public Policy Analysis and Management.     

Interstate migration,income and public school expenditures: An update of an experiment

This article re-examines the relative importance of per capita income and net out-migration (Weisbrod's welfare-maximization hypothesis) as determinants of expenditures for public primary and secondary education. A repetition of Weisbrod's experiment shows that the existence of a high correlation between per capita income and migration in the 1950s would have made it difficult to distinguish between their relative importance. An update of the experiment yields results contrary to the hypothesis that communities (states) are welfare maximizers. They support the contention that per capita income is a primary determinate of educational expenditures.     

England's New Scheme for Funding Higher Education through Student Fees: ‘Fair and Progressive’?

From September 2012 most home undergraduates at English universities are being charged fees of £9,000 per annum. These are funded by a government loan, which attracts interest from the moment they start their course; after three years their accumulated debt exceeds £30,000. They can also borrow to cover their living costs, on the same terms, so that those studying in London can graduate with a debt of more than £50,000—although those from low‐income families can obtain grants and universities are encouraged to provide bursaries and other support to students from underrepresented groups. Graduates start repaying their debts once their annual income exceeds £21,000—at a rate of 9% of the difference between their income and that figure: until the debt is fully repaid it continues to attract interest, by as much as three percentage points above the current inflation rate. Using data from a calculator on a government website, this paper shows that the highest‐paid graduates pay back less than those on middle incomes: the ‘squeezed middle’ pays back more not only than those on low incomes but also the better‐paid and those whose incomes increase more rapidly. This has differential effects according to occupation—and sex; and middle‐income groups also contribute more to the costs of widening participation programmes, which all universities charging more than £6,000 per annum are required to fund.     

An investigative research on the status of urban residents' psychological security

The objective of this study was to investigate the status of the psychological security of 224 urban residents by using a self‐made questionnaire. The results show that the overall psychological security of urban residents is in the medium–low level. There are significant differences among residents with education background or with household per capita monthly income (F = 4.192, F = 4.545, p < 0.05). People with high psychological security scores are highly educated or come from families with high per capita monthly income. In regards to the factors of common sense of security, the results show significant differences (F = 4.98, p < 0.01) among people with different educational background and people with bachelor's degrees or above scores higher than less‐educated people (from high school or community college). In regards to the factors of certainty feeling, there are significant variations among people with genders and economic background (F = 11.28, F = 7.75, p < 0.01), males higher than females, while people with per capita monthly income of more than 2000 RMB feel more certainty than those with less than 2000 RMB. On the sense of calmness, factors such as education and family per capita income significantly affected scores (F = 4.67, p < 0.05, F = 5.20, p < 0.01). People with high school degree feel less calm than those with college degree or above; individuals with per capita monthly income of 2000 RMB feel less calm than those with income higher than 2000 RMB of above. For another dimension, the sense of relaxation, there is a significant difference among different age groups (F = 8.92, p < 0.001, groups below 40 scoring higher than groups over 40). Copyright © 2014 John Wiley & Sons, Ltd.     

The Fiscal Impacts of Urban Sprawl: Evidence From U.S. County Areas

This paper examines the fiscal impacts of urban development patterns in the United States. Previous studies have indicated that it is costly to provide public services in areas with low‐density, spatially expansive development, leading to higher per capita expenditures. However, theory would suggest alternate outcomes. This paper examines this question using a panel dataset of U.S. urban county areas and a specification allowing for potential nonlinearity between development patterns and per capita expenditures. Estimates indicate that the spatial extent of development is the most important factor in expenditures; it is less costly to provide public services when development is more compact. Higher density increases per capita expenditures; however, the effects are small.     

Intergovernmental transfers and fiscal equalization across the north-eastern states of India: Evidence from panel data

While numerous studies have tried to analyze the impact of intergovernmental transfers in fostering fiscal equalization in India, there need to be more studies in the context of north-eastern (NE) states. Situating in a geographically isolated and economically backward region, the states of NE India depend heavily on central fiscal transfers to meet expenditures and to promote various economic activities in the region. One of the essential objectives of these transfers is to achieve fiscal equity. Hence, the study attempts to analyze the fiscal equalizing nature of the intergovernmental transfers across NE India during 1991–2019. The coefficient of variation (CV) analysis results indicates that although fiscal transfers reduced the magnitude of disparity in the own-source revenue across the NE states, a significant amount of disparity still exists in the resource base across these states. The regression analysis findings suggest that the transfers across these states need to be more fiscal equalizing. The per capita gross state domestic product emerges as a positive and significant in predicting per capita transfers, and hence it questions the progressivity of central transfers. When assigning the interstate share of transfers, more weight should be placed on fiscal equalizing factors such as per capita income. The Finance Commission of India should emphasize fiscal equalizing criteria when allocating weights and recommending transfers to the NE States. Additionally, states with low incomes should be recognized in plan schemes.     

Kinder an die Macht?

In order to illuminate the consequences of extra votes for parents, this article looks at the questions of whether parents differ in their party choice from younger people and of what the overall results would have been like for German Bundestag elections in 1994–2005. The results can be summarised as follows: (1) In simple comparisons, parents and childless people have not differed a lot in their party preferences since the first half of the 1990s. However, a more complex analysis of the 2005 elections brought to light systematic differences that are contingent on voters’ age and on their region. (2) The aggregate results of the 1994 to 2005 elections would have looked very much the same. Thus, no party would profit per se in electoral terms from the introduction of the proxy vote for children.     

For a political philosophy of parent–child relationships

Abstract

In Family Values, Harry Brighouse and Adam Swift argue that parents should, in sharing values with their children and in conferring advantage upon them, act in ways that realize the intimacy that lies at the core of the value of family life. In their view, they should prescind from autonomy-inhibiting activities not required by the need to maintain intimacy. I argue that while this standard is sufficient to distinguish between permissible and impermissible practices of advantage conferral, it does not provide us with a perspicuous standard with which to distinguish among activities of value-sharing. This is because the difference between permissible and impermissible forms of value-sharing is adverbial rather than categorical. I argue moreover that even if we were to solve this problem, we would end up with another problem, to do with the unattractive nature of the state activities that would have to be set up in order to police family life. I conclude that the problem of how to enforce the child’s right to autonomous upbringing is best thought of as a political one. Schools, rather than the home, are the appropriate site for the development of autonomy, and the state appropriately regulates schools to ensure that they achieve this end.     

The Impact of Income on the Taste for Revolt

The question of how the level of development affects revolutionary support in society is of fundamental importance. One approach to provide an answer has been to study the relationship between actual civil conflict and income at the national level. This article takes a different approach. It uses microdata sets based on surveys of revolutionary support across one-quarter of a million people and identifies how the responses vary with their incomes. We find that a rise in GDP of $US 1,600 per capita in 2001 values decreases the chances of supporting revolt by 2.4 percentage points which represents a 41% drop in the proportion of people wanting a revolution. For a person who jumps from the bottom to top income quartile within their country, the probability declines by a similar amount. The results are robust to controlling for country and year effects, country-specific time trends and take account of the potential endogeneity of GDP.     

Partnering and Parenting in Poverty: A Qualitative Analysis of a Relationship Skills Program for Low‐Income,Unmarried Families

Since the mid‐1990s, the federal government has funded numerous relationship skills programs, including some specifically targeting low‐income, unmarried parents, in an effort to strengthen couples’ relationships and increase family stability. The previous research on the effectiveness of these interventions has revealed mixed results about whether such programs can improve the relationships of lower income couples who tend to experience lower relationship quality, lower marriage rates, and higher rates of relationship dissolution. This article draws on in‐depth qualitative data collected during an 18‐month ethnographic study of one federally funded relationship skills program for unmarried, low‐income couples expecting a new baby. Overall, though parents found the financial management lessons included in the classes only minimally useful, if at all, they found other aspects of the program particularly useful for three main reasons: (1) classes allowed parents to focus exclusively on their couple relationships in ways they rarely did otherwise; (2) program incentives helped parents make financial ends meet that month; and (3) parents learned that the challenges they personally experienced were often endemic to the romantic and co‐parenting relationships of unmarried parents who have few resources and experience more challenges that tend to undermine relationship quality, such as financial stress and relational ambiguity. Engaging with other couples around shared challenges normalized couples’ relationship problems and lessened the resentment and animosity that typically characterized their partner interactions. These findings have important implications for healthy marriage and relationship policy. Program developers should avoid lessons that imply low‐income, unmarried parents’ spending habits and family‐formation decisions are deficient. Interventions should instead encourage couples to discuss their shared challenges and minimize their tendency to individualize relational and financial strain.     

The Political Determinants of Federal Expenditure at the State Level

It has been shown that states with higher per capita senate representation have higher federal spending per capita (Atlas, C. M., Gilligan, T. A., Hendershott, R. J. and Zupan, M. A. (1995). American Economic Review 85: 624–629). With a more recent data sample, more highly disaggregated data and a different set of political control variables, we are able to confirm the main result of Atlas et al. that per capita senate representation is positively related to federal expenditure. This effect is strongest for procurement expenditures. By contrast, we do not find support for their result that spending increases with per capita representation in the House of Representatives. Several other political variables are found to be significant in a subset of the expenditure equations.     

On “Group size and the free-rider hypothesis: Another hypothesis.” by Jody W. Lipford: Comment

This paper develops a positive approach to grant design when the central government and a lobby of local governments are the main agents. It develops the hypothesis that the regressivity or progressivity of per capita grants regarding community size is,ceteris paribus, related to the structure of the lobbying activities of local governments and is independent of hypothetical economies or diseconomies of scale in the production of local public goods. An encompassing lobby organisation using a “one mayor one vote” system of representation supports the regressivity of per capita grants while under “proportional” representation the lobby will support a design of per capita grants which is progressive towards community size. An empirical analysis of lump-sum grants in Portugal supports the politico-economic hypothesis and rejects the hypothesis that economies of scale is the main explanatory cause for the observed regressivity of per capita grants.     

Reapportionment and Redistribution: Consequences of Electoral Reform in Japan

Does reapportionment in a legislature affect policy outcomes? We examine this question from a comparative perspective by focusing on reapportionment associated with the electoral reform in Japan. First, we show that the reform of 1994 resulted in an unprecedented degree of equalization in legislative representation. Second, using municipal‐level data, we present evidence that municipalities in overrepresented districts received significantly more subsidies per capita, as compared to those in underrepresented districts, in both prereform and postreform years. Third, by examining the relationship between the change in the number of seats per capita and the change in the amount of subsidies per capita at the municipal level, we show that the equalization in voting strength resulted in an equalization of total transfers per person.     

Much Ado about Nothing? The Size and Credit Quality Implications of Municipal Other Postemployment Benefit Liabilities

This paper presents estimates of the size and scope of other postemployment benefit (OPEB) liabilities among municipal governments. The findings indicate these liabilities vary substantially, ranging from less than a dollar per capita to more than $2,000 per capita. Those liabilities were then incorporated into separate models of credit ratings and borrowing costs. Results suggest OPEB liabilities do not directly affect credit quality, but the interaction between an issuer's fiscal capacity to address its liability does have a notable effect.