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Author: Ali Alichi
Publisher: International Monetary Fund
ISBN: 1484328299
Category : Business & Economics
Languages : en
Pages : 66
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Book Description
Data show that middle-income households have continued moving down, and less so up, the income distribution in the United States since the 1970s—a phenomenon that is often referred to as the polarization or “hollowing out” of the income distribution. While the level of income polarization is generally lower in the richer states (i.e., those with higher median household income levels), there have been wide variations in the changes in income polarization over time across states. The paper develops two indices to measure income polarization including a novel hollowing-out index. Another important contribution of the paper is to examine the proximate causes of income polarization. The econometric analysis is done at both state and household levels. The results suggest that technology, measured by job routinization, and international trade, measured by job offshoring, can fully explain the non-trend rise in income polarization, with broadly equal contributions. Household characteristics, including age, education, race, and gender have also been important drivers but with a net countervailing effect on income polarization. This is mainly thanks to the rising education level of households, which has led to better incomes.
Author: Ali Alichi
Publisher: International Monetary Fund
ISBN: 1484328299
Category : Business & Economics
Languages : en
Pages : 66
Get Book
Book Description
Data show that middle-income households have continued moving down, and less so up, the income distribution in the United States since the 1970s—a phenomenon that is often referred to as the polarization or “hollowing out” of the income distribution. While the level of income polarization is generally lower in the richer states (i.e., those with higher median household income levels), there have been wide variations in the changes in income polarization over time across states. The paper develops two indices to measure income polarization including a novel hollowing-out index. Another important contribution of the paper is to examine the proximate causes of income polarization. The econometric analysis is done at both state and household levels. The results suggest that technology, measured by job routinization, and international trade, measured by job offshoring, can fully explain the non-trend rise in income polarization, with broadly equal contributions. Household characteristics, including age, education, race, and gender have also been important drivers but with a net countervailing effect on income polarization. This is mainly thanks to the rising education level of households, which has led to better incomes.
Author: Ali Alichi
Publisher: International Monetary Fund
ISBN: 1475522568
Category : Business & Economics
Languages : en
Pages : 36
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Book Description
The paper uses a combination of micro-level datasets to document the rise of income polarization—what some have referred to as the “hollowing out” of the income distribution—in the United States, since the 1970s. While in the initial decades more middle-income households moved up, rather than down, the income ladder, since the turn of the current century, most of polarization has been towards lower incomes. This result is striking and in contrast with findings of other recent contributions. In addition, the paper finds evidence that, after conditioning on income and household characteristics, the marginal propensity to consume from permanent changes in income has somewhat fallen in recent years. We assess the potential impacts of these trends on private consumption. During 1998-2013, the rise in income polarization and lower marginal propensity to consume have suppressed the level of real consumption at the aggregate level, by about 31⁄2 percent—equivalent to more than one year of consumption.
Author: International Monetary Fund. Western Hemisphere Dept.
Publisher: International Monetary Fund
ISBN: 1484312686
Category : Business & Economics
Languages : en
Pages : 86
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Book Description
This 2017 Article IV Consultation highlights that the United States is in the longest expansion since 1850. The unemployment rate has fallen to 4.4 percent and job growth continues to be strong. The economy has gone through a temporary growth dip in the early part of 2017, but momentum has picked up. The economy is expected to grow at 2.1 percent in 2017 and 2018, supported by solid consumption growth and a rebound in investment. Over the next 12–18 months, personal consumer expenditure inflation is expected to slowly rise above 2 percent, before returning to the Federal Reserve’s medium-term target of 2 percent.
Author: Karen Petrou
Publisher: John Wiley & Sons
ISBN: 1119726743
Category : Business & Economics
Languages : en
Pages : 291
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Book Description
The first book to reveal how the Federal Reserve holds the key to making us more economically equal, written by an author with unparalleled expertise in the real world of financial policy Following the 2008 financial crisis, the Federal Reserve’s monetary policy placed much greater focus on stabilizing the market than on helping struggling Americans. As a result, the richest Americans got a lot richer while the middle class shrank and economic and wealth inequality skyrocketed. In Engine of Inequality, Karen Petrou offers pragmatic solutions for creating more inclusive monetary policy and equality-enhancing financial regulation as quickly and painlessly as possible. Karen Petrou is a leading financial-policy analyst and consultant with unrivaled knowledge of what drives the decisions of federal officials and how big banks respond to financial policy in the real world. Instead of proposing legislation that would never pass Congress, the author provides an insider's look at politically plausible, high-impact financial policy fixes that will radically shift the equality balance. Offering an innovative, powerful, and highly practical solution for immediately turning around the enormous nationwide problem of economic inequality, this groundbreaking book: Presents practical ways America can and should tackle economic inequality with fast-acting results Provides revealing examples of exactly how bad economic inequality in America has become no matter how hard we all work Demonstrates that increasing inequality is disastrous for long-term economic growth, political action, and even personal happiness Explains why your bank's interest rates are still only a fraction of what they were even though the rich are getting richer than ever, faster than ever Reveals the dangers of FinTech and BigTech companies taking over banking Shows how Facebook wants to control even the dollars in your wallet Discusses who shares the blame for our economic inequality, including the Fed, regulators, Congress, and even economists Engine of Inequality: The Fed and the Future of Wealth in America should be required reading for leaders, policymakers, regulators, media professionals, and all Americans wanting to ensure that the nation’s financial policy will be a force for promoting economic equality.
Author: OECD
Publisher: OECD Publishing
ISBN: 9264968490
Category :
Languages : en
Pages : 126
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Book Description
The United States economy rebounded strongly from the depths of the pandemic recession, aided by a large and enduring government policy response. However, Russia’s war against Ukraine and strong inflationary pressures have dampened the economic outlook. The administration is reinforcing public welfare through packages that invest in infrastructure and the climate transition, but an ageing population means fiscal pressures are on the horizon.
Author: Natalija Novta
Publisher: International Monetary Fund
ISBN: 1498320457
Category : Business & Economics
Languages : en
Pages : 28
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Book Description
We examine the extent to which declining manufacturing employment may have contributed to increasing inequality in advanced economies. This contribution is typically small, except in the United States. We explore two possible explanations: the high initial manufacturing wage premium and the high level of income inequality. The manufacturing wage premium declined between the 1980s and the 2000s in the United States, but it does not explain the contemporaneous rise in inequality. Instead, high income inequality played a large role. This is because manufacturing job loss typically implies a move to the service sector, for which the worker is not skilled at first and accepts a low-skill wage. On average, the associated wage cut increases with the overall level of income inequality in the country, conditional on moving down in the wage distribution. Based on a stylized scenario, we calculate that the movement of workers to low-skill service sector jobs can account for about a quarter of the increase in inequality between the 1980s and the 2000s in the United States. Had the U.S. income distribution been more equal, only about one tenth of the actual increase in inequality could have been attributed to the loss of manufacturing jobs, according to our simulations.
Author: Mr.Nigel A Chalk
Publisher: International Monetary Fund
ISBN: 1484372549
Category : Business & Economics
Languages : en
Pages : 48
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Book Description
This paper assesses the landmark Tax Cuts and Jobs Act (TCJA), from the perspective of both the U.S. itself and the wider world. The reform has many positive aspects including steps to broaden the base of, and reduce marginal rates under, the personal income tax (PIT), reduce distortions to investment and financing decisions, and mitigate outward profit shifting. But the TCJA has a large fiscal price tag and leaves significant uncertainty as to how the U.S. tax system will develop. The PIT changes could have better targeted relief at low earners, and there is scope to more fully address distortions in business taxation. The novel international provisions create a complex array of both positive and negative international spillovers, and have the potential to significantly reshape the wider international tax system.
Author: International Monetary Fund. Western Hemisphere Dept.
Publisher: International Monetary Fund
ISBN: 1484339878
Category : Business & Economics
Languages : en
Pages : 134
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Book Description
The world economy and global trade are experiencing a broad-based cyclical upswing. Since October 2017, global growth outcomes and the outlook for 2018–19 have improved across all regions, reinforced by the expected positive near-term spillovers from tax policy changes in the United States. Accommodative global financial conditions, despite some tightening and market volatility in early February 2018, have been providing support to economic recovery. Higher commodity prices are contributing to an improved outlook for commodity exporters. The US and Canadian economies posted solid gains in 2017 and are expected to grow above potential in the near term. Despite the improved near-term outlook, however, medium-term prospects are tilted downwards. Growth prospects for advanced economies are subdued and many emerging market and developing economies are projected to grow in per capita terms more slowly than advanced economies, raising concerns about income convergence. While risks appear broadly balanced in the near term, they skew to the downside over the medium term, including a possible sharp tightening of financial conditions, waning popular support for global economic integration, growing trade tensions and risks of a shift toward protectionist policies, and geopolitical strains.
Author: Ms. Era Dabla-Norris
Publisher: International Monetary Fund
ISBN: 1513547437
Category : Business & Economics
Languages : en
Pages : 33
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Book Description
This paper analyzes the extent of income inequality from a global perspective, its drivers, and what to do about it. The drivers of inequality vary widely amongst countries, with some common drivers being the skill premium associated with technical change and globalization, weakening protection for labor, and lack of financial inclusion in developing countries. We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down. This suggests that policies need to be country specific but should focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class. To tackle inequality, financial inclusion is imperative in emerging and developing countries while in advanced economies, policies should focus on raising human capital and skills and making tax systems more progressive.
Author: Steven Levitsky
Publisher: Crown
ISBN: 1524762946
Category : Political Science
Languages : en
Pages : 321
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Book Description
NEW YORK TIMES BESTSELLER • “Comprehensive, enlightening, and terrifyingly timely.”—The New York Times Book Review (Editors' Choice) WINNER OF THE GOLDSMITH BOOK PRIZE • SHORTLISTED FOR THE LIONEL GELBER PRIZE • NAMED ONE OF THE BEST BOOKS OF THE YEAR BY The Washington Post • Time • Foreign Affairs • WBUR • Paste Donald Trump’s presidency has raised a question that many of us never thought we’d be asking: Is our democracy in danger? Harvard professors Steven Levitsky and Daniel Ziblatt have spent more than twenty years studying the breakdown of democracies in Europe and Latin America, and they believe the answer is yes. Democracy no longer ends with a bang—in a revolution or military coup—but with a whimper: the slow, steady weakening of critical institutions, such as the judiciary and the press, and the gradual erosion of long-standing political norms. The good news is that there are several exit ramps on the road to authoritarianism. The bad news is that, by electing Trump, we have already passed the first one. Drawing on decades of research and a wide range of historical and global examples, from 1930s Europe to contemporary Hungary, Turkey, and Venezuela, to the American South during Jim Crow, Levitsky and Ziblatt show how democracies die—and how ours can be saved. Praise for How Democracies Die “What we desperately need is a sober, dispassionate look at the current state of affairs. Steven Levitsky and Daniel Ziblatt, two of the most respected scholars in the field of democracy studies, offer just that.”—The Washington Post “Where Levitsky and Ziblatt make their mark is in weaving together political science and historical analysis of both domestic and international democratic crises; in doing so, they expand the conversation beyond Trump and before him, to other countries and to the deep structure of American democracy and politics.”—Ezra Klein, Vox “If you only read one book for the rest of the year, read How Democracies Die. . . .This is not a book for just Democrats or Republicans. It is a book for all Americans. It is nonpartisan. It is fact based. It is deeply rooted in history. . . . The best commentary on our politics, no contest.”—Michael Morrell, former Acting Director of the Central Intelligence Agency (via Twitter) “A smart and deeply informed book about the ways in which democracy is being undermined in dozens of countries around the world, and in ways that are perfectly legal.”—Fareed Zakaria, CNN
