Map of the day

Posted: 1 March 2015 in Uncategorized
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economic segregation

It is not just that the economic divide in America has grown wider; it’s that the rich and poor effectively occupy different worlds, even when they live in the same cities and metros.

That’s the conclusion of a new study by Richard Florida and Charlotta Mellander [pdf]. What they do is construct an index of economic segregation based on three variables—income, education, and occupation—which are themselves highly correlated.

The ten large metropoles with the highest values on the Overall Economic Segregation Index are Austin, Columbus, San Antonio, Houston, Los Angeles, New York, Dallas, Philadelphia, Chicago, and Memphis. When the listed is expanded to cover all metro areas, a number of college towns rise to the top: Tallahassee (home to Florida State University) jumps to first place and Trenton-Ewing (Princeton University) to second, while Austin falls to third. Tucson (University of Arizona) and Ann Arbor (University of Michigan) also make the list, along with Bridgeport-Stamford-Norwalk.

The least segregated large metropoles include Orlando, Portland, Minneapolis-St. Paul, Providence, and Virginia Beach. Rustbelt metros like Cincinnati, Rochester, Buffalo, and Pittsburgh also have relatively low levels of overall economic segregation.

Another notable finding is that economic segregation tends to be more intensive in high-tech, knowledge-based metropolitan areas. It is positively correlated with high-tech industry, the “creative class” share of the workforce, and the share of college graduates. In other words, the so-called new economy is less a cure and more a cause of the new levels of class segregation in urban America.

And the implication of their analysis?

Where cities and neighborhoods once mixed different kinds of people together, they are now becoming more homogenous and segregated by income, education, and occupation. Separating across these three key dimensions of socio-economic class, this bigger sort threatens to undermine the essential role that cities have played as incubators of innovation, creativity, and economic progress.

Capitalism kills babies, middle-aged people, and other living things

Posted: 1 March 2015 in Uncategorized
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While mainstream economists continue to discuss and debate their favorite topics—when to hike interest rates, the appropriate measure of capital, how to apply monetary rules, the outcome of debt negotiations in Europe, and much else—they never mention one obvious fact: capitalism kills. In particular, it kills babies and middle-aged people.

According to Alice Chen, Emily Oster, and Heidi Williams [pdf], capitalism kills babies. The United States, for example, ranks fifty-first in the world in infant mortality—comparable to Croatia, despite an almost three-fold difference in income per capita. But, as it turns out, it’s not differences at birth that explain the low ranking of the United States; it’s the high rate of postneonatal deaths. And that high rate (e.g., in comparison to Finland and Austria in the authors’ study) is “due entirely, or almost entirely, to high mortality among less advantaged groups. Well-off individuals in all three countries have similar infant mortality rates.” In other words, the high level of infant deaths in the United States are almost entirely a consequence of the grotesque levels of economic inequality that capitalism has created within the United States.

We also have to admit that capitalism kills middle-aged people. In a study recently published in the American Journal of Preventive Medicine, Katherine A. Hempstead and Julie A. Phillips found that suicide rates among middle-aged men and women in the United States have been increasing since 1999, with a sharp escalation since 2007. Their conclusion is that

Relative to other age groups, a larger and increasing proportion of middle-aged suicides have circumstances associated with job, financial, or legal distress and are completed using suffocation. The sharpest increase in external circumstances appears to be temporally related to the worst years of the Great Recession, consistent with other work showing a link between deteriorating economic conditions and suicide.

What’s the old adage, an ounce of prevention is worth a pound of cure? Well, in this case, preventing neonatal deaths and middle-aged suicides should start with eliminating capitalism.

Cartoon of the day

Posted: 1 March 2015 in Uncategorized
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Special mention

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Chart of the day

Posted: 28 February 2015 in Uncategorized
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net worth

According to a new study by the Federal Reserve Bank of St. Louis, little has changed over the past 25 years in terms of the glaring wealth gap in the United States between blacks and Hispanics on one hand, and whites on the other.

The median wealth levels of Hispanic and black families are about 90 percent lower today than the median wealth levels for whites. Back in 1989, the median wealth of a white family was $130,102. In 2013, it was $134,008, after adjusting for inflation. For a Hispanic family, they were $9,229 and $13,900, while for a black family, they were $7,736 and $11,184.

The one group that has experienced an improvement, both absolutely and relative to whites, are Asian families. Their real median wealth grew between 1989 and 2013 from $64,165 to $91,440. And, because of that growth, and the precipitous decline in white family wealth after 2007, Asian household wealth rose from 49 to 68 percent of white wealth.

While the authors of the study do not attempt to analyze all the factors causing the large and persistent gap between white and black/Hispanic wealth, they do look at the role of age profiles and educational attainment and conclude that

differences in the age composition and in the level of educational attainment across groups explain relatively little of the gaps. Indeed, race- and ethnicity-related financial-health disparities are greatest among older and better-educated groups, where financial health and wealth generally are at their highest levels.

Cartoon of the day

Posted: 28 February 2015 in Uncategorized
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saved___tjeerd_royaards

Special mention

tankers_590_356 www.usnews

Chart of the day

Posted: 27 February 2015 in Uncategorized
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Jaumotte-IMF

According to a new study from the International Monetary Fund,

Inequality has risen in many advanced economies since the 1980s, largely because of the concentration of incomes at the top of the distribution. Measures of inequality have increased substantially, but the most striking development is the large and continuous increase in the share of total income garnered by the 10 percent of the population that earns the most—which is only partially captured by the more traditional measure of inequality, the Gini coefficient (see Chart 1). . .

we find strong evidence that lower unionization is associated with an increase in top income shares in advanced economies during the period 1980–2010 (for example, see Chart 2), thus challenging preconceptions about the channels through which union density affects income distribution.

The main channels they identify include wage dispersion (unionization reduces inequality by helping equalize the distribution of wages), unemployment (union density does not, in general, raise unemployment), and redistribution (strong unions induce policymakers to engage in more redistribution by mobilizing workers to vote for parties that promise to redistribute income or by leading all political parties to do so). Thus, they find, lower union density can increase top income shares by reducing the bargaining power of workers.

The obvious policy conclusions, then, are to improve rules and regulations that allow workers to organize and bargain collectively and to engage in corporate governance reforms that give workers more of a say in the major decisions taken by enterprises—not only in terms of executive pay, but also where and when jobs are created and how the resulting surplus is allocated.

“We are Germans!”

Posted: 27 February 2015 in Uncategorized
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[ht: ke]

My only excuse: it’s Friday. . .

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