Weekend reading: “household insecurity” edition
This is a weekly post we publish on Fridays with links to articles that touch on economic inequality and growth. The first section is a round-up of what Equitable Growth published this week and the second is the work we’re highlighting from elsewhere. We won’t be the first to share these articles, but we hope by taking a look back at the whole week, we can put them in context.
Equitable Growth round-up
Household income in the United States has steadily become more volatile over the past several decades, even among those headed by college-educated people. Nisha Chikhale digs in on what’s behind this rise in household insecurity and its implications for overall economic growth and macroeconomic stability in a new report and accompanying issue brief.
Does raising the U.S. minimum wage have a negative effect on the employment of low-wage workers? In a new Equitable Growth Working Paper, U.S. Census Bureau economists Kevin Rinz and John Voorheis use linked employer-employee data to study this question. They find that increasing the minimum wage increases earnings for those at the bottom of the income ladder without decreasing employment. Read more about the paper’s findings and their implications for policy in the Value Added about the paper by Kate Bahn.
In a new column on the importance of geography for economic mobility, Richard Florida of CityLab and the University of Toronto highlights the newest work on the impact of education on U.S. intergenerational mobility by University of California, Berkeley economist and Equitable Growth grantee Jesse Rothstein.
If this round-up wasn’t enough for you, check out UC-Berkeley economist and Equitablog author Brad DeLong’s round-up of worthy reads on equitable growth from this past week.
Links from around the web
Rules requiring that recipients of social safety net programs, such as Medicaid, housing aid, and Supplemental Nutrition Assistance Program work a minimum of 20 hours a week are being drafted and debated as part of current legislation before the U.S. Congress. But what if there are no jobs to work at where you live? Emily Badger and Margot Sanger-Katz write about how proposals to address this issue might only further embed racial and geographic biases about who is “deserving” of the federal social safety net. [the upshot]
The Chicago School has been synomous with the consumer welfare standard in antitrust law for decades. Now a new essay by University of Chicago economist Eric Posner, Microsoft Corp.’s E. Glen Weyl, and Columbia’ University’s Suresh Naidu argue that U.S. antitrust law must consider effects for workers, not just consumers when evaluating proposed mergers. They argue that many labor markets in the United States are concentrated and uncompetitive, or monopsonistic, which suppresses wages and economic growth. [bloomberg]
Despite the low U.S. unemployment rate and complaints from employers about the challenge of finding workers, wage growth remains an anemic 2.5 percent. Compare that to 3.5 percent to 4 percent during both of the last two economic expansions. Evan Horowitz digs into some of the recent debate about explanations for sluggish wage growth. [boston globe]
Matthew Stewart argues that it’s not just the concentration of wealth and privilege among the top 0.01 percent that’s hurting economic mobility in the United States, but also the concentration among the top 9.9 percent, or those with net worths of at least $1.2 million. [the atlantic]
Friday figure
Figure is from “Household insecurity matters for U.S. economic growth and stability,” by Equitable Growth’s Nisha Chikhale.