New Research Will Lead to Better Understanding of How Human Capital, Consumer Demand, and the Role of Government and Institutions Affects Economic Growth and Productivity
Washington, D.C. – The Washington Center for Equitable Growth is pleased to announce its inaugural class of grantees for 2014. Equitable Growth will award $481,000 to 15 grantees, with additional funding for two of those grantees provided by the Russell Sage Foundation, the century-old foundation devoted to funding research in the social sciences.
“Motivating academic economists to investigate whether and how structural changes in the U.S. economy, particularly those related to the distribution of wealth and the provision of opportunity, affect economic growth is exceedingly important,” says Heather Boushey, executive director and chief economist at Equitable Growth. “Encouraging new academic thinking will offer important contributions to understanding what is good and bad for our economy and lay the groundwork for even more data-driven research in the years to come.”
Equitable Growth is awarding 9 distinguished scholars a total of $391,000 to conduct seminal research on these possible effects, with the Russell Sage Foundation co-funding an additional $68,000 for two of those grantees. In addition, Equitable Growth is providing six grants of $15,000 each to young scholars engaged in graduate-level or post-doctoral work. The total research support for this inaugural set of grantees from both grantmaking institutions is $550,000. (Update: on September 19, 2014, an additional grantee was announced, Ethan Kaplan, an assistant professor of economics at the University of Maryland, who was awarded a $60,000 grant. See page 52 of our conference report in September for details on this grant.)
“Strong empirical evidence in economics and other social sciences suggests that the strength of the middle class and the level of income inequality play an important role in driving economic growth and productivity,” says Elisabeth Jacobs, senior director for policy and academic programs. “Our grantees will accelerate research in the coming year by focusing on three channels through which inequality impacts growth: human capital, consumer demand, and the role of government and labor market institutions.”
Building on foundational research done by Washington Center for Equitable Growth’s in-house research team, the inaugural class of grantees will contribute to the new and growing fields of research in the following areas:
Three grants will examine the role of human capital—the talent needed to boost our economy’s productivity. They were awarded to:
• University of Maryland sociologist Philip Cohen, who will investigate the implications of economic inequality for women’s employment patterns.
• University of Chicago development psychologist and public policy professor Ariel Kalil, who will research the role of inequality in parenting and the acquisition of skills in pre-school aged children.
• University of California-Berkeley economist Jesse Rothstein, who will explore the consequences of school finance reforms on educational equity.
Taken together these grants will explore whether and how inequality affects human capital, specifically examining the importance of investments in early childhood and public primary and secondary schooling.
Three grants will support research on the demand side of the economy, including both debt and consumption, in order to broaden our understanding of how demand drives growth by creating markets for goods and services and allowing investors to plan for the future. They were awarded to:
• University of Michigan law professor Michael Barr, who will study how families manage different kinds of debt.
• Princeton University economist Will Dobbie, who will generate new data to explore the impact of debt forgiveness on economic stability and recoveries from recessions.
• University of Wisconsin-Madison public affairs and economics professor Timothy Smeeding, who will explore how inequality in the distribution of income and wealth affect consumption.
These grants focus on whether and how inequality affects patterns of indebtedness and consumption, which affects economic growth and stability.
Three grants will fund investigations into quality of government and labor market institutions in fostering economic growth and stability. They were awarded to:
• The New School economist David Howell, who will examine cross-country trends in “good jobs” with a focus on how different institutional settings can affect the relationship between economic growth, employment growth, and the generation of good jobs.
• University of North Carolina-Chapel Hill urban planning professor William Lester who will look at how regional variations in labor market regulation influence business decisions.
• University of California-Hastings College of the Law professor Joan Williams, who will investigate how workplace scheduling practices conflict with family care-giving needs, and how improving these practices could improve business productivity.
These grants will examine how labor market institutions and public policies affect employment and business outcomes and will inform a variety of employment policies at the local, state, and federal levels.
Equitable Growth’s six young scholar grantees—either graduate students or newly minted Ph.Ds—are:
• Pascal Noel at Harvard University, who will investigate the implications of social insurance for equitable growth.
• Shayak Sarkar and Ryan Sakoda at Harvard, who will study the impact of need-based financial aid on college attendance for low-income students.
• Stefanie Stancheva at the Massachusetts Institute of Technology, who will look at the effects of progressive taxation on innovation and growth.
• Vanessa Williamson at Harvard, who will explore public support for different tax structures.
• Danny Yagan at the University of California-Berkeley, who will examine the U.S. tax structure for capital income.
• Owen Zidar at the University of Chicago’s Booth School of Business, who will research tax policy and the distribution of income between labor and capital.
Several of these scholars are beginning tenure-track positions at top universities beginning in the next academic year. Encouraging these up-and-coming researchers to pursue these lines of inquiry will create a pool of academics engaged early in their careers in investigating critical questions for understanding how to create equitable growth.
For a more detailed list of our 2014 grantee awards click here.
The Washington Center for Equitable Growth is a new research and grantmaking organization founded to accelerate cutting-edge analysis into whether and how structural changes in the U.S. economy, particularly related to economic inequality, affect growth.
To learn more, please visit: www.equitablegrowth.org. Follow us on Twitter at www.twitter.com/equitablegrowth.