Income Comparisons Research Articles

Adult children's socioeconomic positions and their parents' mortality: A comparison of education, occupational class, and income

Recent research has shown that the parents of well-educated children live longer than do other parents and that this association is only partly confounded by the parent's own socioeconomic position. However, the relationships between other aspects of children's socioeconomic position (e.g., occupational class and economic resources) and parental mortality have not been examined.Using the Swedish Multi-generation Register that connects parents to their children, this paper studies the associations of children's various socioeconomic resources (education, occupation, and income) and parents' mortality. The models are adjusted for a range of parental socioeconomic resources and include the resources of the parents' partners. In addition to all-cause mortality, five causes of death are analyzed separately (circulatory disease mortality, overall cancer, lung cancer, breast cancer, and prostate cancer).The results show net associations between all included indicators of children's socioeconomic position and parents' mortality risk, with the clearest association for education. Children's education is significantly associated with all of the examined causes of death except prostate cancer. Breast cancer mortality is negatively related to offspring's education but not the mothers' own education.To conclude, children's education seems to be a key factor compared with other dimensions of socioeconomic position in the offspring generation. This finding suggests that explanations linked to behavioral norms or knowledge are more plausible than those linked to access to material resources. However, it is possible that children's education – to a greater degree than class and income – captures unmeasured parental characteristics.The cause-specific analyses imply that future research should investigate whether offspring's socioeconomic position is linked to the likelihood of developing diseases and/or the chances of treating them. A broader family perspective in the description and explanations of social inequalities in health that includes the younger generation may increase our understanding of why these inequalities persist across the life course.

Promoting SMEs and Enhancing Labor Productivity in Singapore: A Policy Analysis

While Singapore has been doing well in terms of cross-country per capita income comparisons and in terms of overall employment growth, it has been a laggard when it comes to labor productivity and this concern is more serious for small and medium enterprises (SMEs). In this context, this paper first identifies the sources of gross domestic product (GDP) growth and simulates different scenarios pertaining to the potential GDP which the economy can achieve given the level of required productivity based on some employment-growth assumptions. Further, the paper reevaluates the performance, challenges and opportunities for SMEs as well as suggests several policy strategies as to how SMEs can synergize and be more competitive moving forward.

Happiness, Comparison Effects, and Expectations in Turkey

It is crucial to know the factors that influence happiness. This study investigates the determinants of happiness with an emphasis on comparison effects (income relative to others’ income or relative to the own income in the past) and expectations about own future income. Nationally representative cross-sectional data collected by a Turkish survey on happiness of individuals 18 or older in years 2003–2011 are used to conduct regression analyses. The dataset includes around 6,000–7,000 individuals in each year. The findings of the study indicate that favorable income comparisons and expectations of future household income are correlated with a higher level of happiness, consistent with a model in which both comparisons and income expectations are seen as a consumption good. Secondly, comparisons and expectations bear on happiness asymmetrically. Third, the estimated effect of expecting higher income is smaller in Turkey than the estimates reported in the literature. Fourth, the magnitudes of the effects of comparisons and expectations depend on the business cycle. In crisis years, compared to years of economic expansion, the importance for happiness of having high absolute income is greater and the importance of having high relative income or high income expectations is lower. Finally, Turkish people have greater concern for their relative position in the society than for having higher absolute income in the future. Several robustness checks lend support to the validity of the aforementioned results.

Satisfaction and comparison income in transition and developed economies

The main purpose of this paper is to evaluate the impact of different types of income comparison on subjective well-being in transition countries and developed European countries. The paper relies on the Life in Transition Survey (European Bank for Reconstruction and Development 2011), which was conducted in late 2010 jointly by the European Bank for Reconstruction and Development and the World Bank. The emphasis of the paper is on income comparisons, specifically; local comparisons and self-ranking. The main findings reveal that comparisons have a significant impact on life satisfaction in transition countries, whereas the relationship between comparison and life satisfaction is ambiguous in developed European countries. In transition countries, the impact of comparisons is asymmetric: in most cases, under-performing one’s benchmark has a greater effect than out-performing it. In transition countries, both downward and upward evaluations have an impact on life satisfaction, while it is worthy of note that all upward evaluations have no effect on life satisfaction in developed European countries.

Comparison of supermarket and traditional market supply vegetable farmers of two districts of India

The study was done on the economic analysis of tomato, brinjal and bhendi cultivation with a comparison of income, access to technology of supermarket and traditional market supply farmers in the two selected districts. The per hectare cost of cultivation of the three selected vegetables on supermarket and traditional market supply farms revealed that cost of cultivation of vegetables was remarkably higher for traditional farms than supermarket supplying farms. This was mainly due to excessive use of manures and fertilizers, irrigation, plant protection chemicals and human labour. The returns per rupee invested have been noted higher for supermarket supply farmers than that of traditional farmers. The evidence indicates that innovative institutions contribute in reducing production cost and augmenting farm profits. Discriminant function analysis shows that price, manures and fertilizers, yield, hired labour and net income contributed mostly to discriminate between two groups’ viz., supermarket and traditional market supplying farmers. DOI: http://dx.doi.org/10.3329/sja.v10i2.18333 SAARC J. Agri., 10(2): 121-136 (2012)

Household spending patterns and flow of ecotourism income into communities around Liwonde National Park, Malawi

Rural Malawi is largely characterised by high levels of poverty, unemployment and high population densities. It is also seen as the ‘warm heart of Africa’, which, together with its abundant natural resources, makes it an excellent destination for international ecotourists. This paper looks at the impact of ecotourism employment on poverty reduction and the flow of ecotourism income into the villages adjacent to Liwonde National Park. Extensive questionnaire surveys were conducted with staff employed in ecotourism as well as with rural households in the villages adjacent to the Park. Comparisons of household income and social welfare highlight the important role of ecotourism employment in lifting people in these rural villages above the poverty line. Household spending patterns illustrate the flow of income from ecotourism into the local economy and the important impact of this on local socio-economic development. Suggestions for increasing local multiplier effects of ecotourism are put forward.

Relative Status and Well-Being: Evidence from U.S. Suicide Deaths

AbstractWe assess the importance of interpersonal income comparisons using data on suicide deaths. We examine whether suicide risk is related to others' income, holding own income and other individual and environmental factors fixed. We estimate models of the suicide hazard using two independent data sets: the National Longitudinal Mortality Study and the National Center for Health Statistics' Multiple Cause of Death Files combined with the 5% Public Use Micro Sample of the 1990 decennial census. Results from both data sources show that, controlling for own income and individual characteristics, individual suicide risk rises with others' income.

A Socio-Demographic Profile of MMori Living in Australia

Māori are unique among Indigenous peoples in the settler states in that a substantial share of the population – nearly one in five – resides overseas, with the vast majority living in Australia. Using data from the 2011 Australian Census of Population and Housing, this paper examines the educational and employment outcomes of resident Māori in the prime working ages. It finds that Māori migrants, especially men, had much lower levels of completed education and tertiary participation than Australian-born Māori, non-Māori New Zealanders and the general Australian population. While the employment rate of Māori men in the prime working ages exceeded the national rate, they tended to be concentrated in low-skilled occupations and industries associated with greater vulnerability to exogenous shocks and restructuring. Income comparisons suggest a positive migrant premium for Māori workers in some lower-skilled jobs but relatively lower earnings for those employed in higher-skilled occupations. While some Māori in Australia may be living a relatively good life, there are multiple vulnerabilities and potential pitfalls amplified by the very limited access to social security should they lose their jobs. As Māori society becomes increasingly diasporic, understanding the experiences and circumstances of expatriate Māori warrants greater attention in terms of their contribution to Māori development pathways and self-determining aspirations 'at home'.

Association of Income Level With Kidney Disease Severity and Progression Among Children and Adolescents With CKD: A Report From the Chronic Kidney Disease in Children (CKiD) Study

Among adults, lower socioeconomic status (SES) is a risk factor for chronic kidney disease (CKD), progression to end-stage renal disease, and poor health outcomes; but its impact on young people with CKD is not established. Prospective cohort study. 572 children and adolescents aged 1-16 years with mild to moderate CKD residing in the United States and Canada who were enrolled in the Chronic Kidney Disease in Children (CKiD) Study. Self-reported annual household income category as a proxy measure for SES: ≥$75,000 (high income), $30,000 to <$75,000 (middle income) and <$30,000 (low income). Clinical characteristics and CKD severity at baseline (glomerular filtration rate [GFR] and comorbid conditions related to disease severity and management) and longitudinally (GFR decline and changes in blood pressure z scores and height z scores per year). At baseline, low and middle household incomes, compared to high income, were associated with minority race (39% and 20% vs. 7%), lower maternal education (28% and 5% vs. 1%), abnormal birth history (34% and 32% vs. 21%), and having at least one clinical comorbid condition (66% and 64% vs. 55%). Baseline median GFRs were similar across income categories (43-45 mL/min/1.73 m2). After adjusting for baseline differences, average GFR declines per year for the low-, middle-, and high-income categories were -2.3%, -2.7%, and -1.9%, respectively, and were not statistically significantly different among groups. Blood pressure control tended to improve in all groups (z score, -0.10 to -0.04) but higher income was associated with a faster improvement. Each group showed similar deficits in height at baseline. Height deficits diminished over time for participants from high-income families, but not among those from low-income families (z scores for height per year, 0.05 and -0.004, respectively; P = 0.03 for comparison of high and low income). Income is an imperfect measure for SES; CKiD participants are not representative of children and adolescents with CKD who are uninsured or not receiving care; statistical power to detect associations by income level is limited. GFR decline was similar across income groups but better improvement in BP was observed among those with high income. Children and adolescents with CKD from lower income households are at higher risk of impaired growth.

Measuring Global Poverty: Why PPP Methods Matter

Abstract We present theory and evidence to suggest that, in the context of analyzing global poverty, the EKS approach to estimating purchasing power parities yields more appropriate international comparison of real incomes than the Geary-Khamis approach. Our analysis of the 1996 and 2005 International Comparison Project data confirms that the Geary-Khamis approach substantially overstates the relative incomes of the world's poorest nations, and this leads to misleading comparisons of poverty across regions and over time. The EKS index of real income is much closer to being a true index of economic welfare and is therefore preferred for assessment of global poverty.

Beyond the Joneses: Inter-country income comparisons and happiness

Our paper provides novel evidence on the burgeoning literature on life satisfaction and relative comparisons by showing that in the last 30 years comparisons with the well being of top income neighboring countries have generated negative feelings on a large sample of individuals in the Euro barometer survey. The paper shows that neighboring countries, and not just our individual neighbors or peers, can be reference groups and that the above mentioned effect depends on the intensity of media exposure.

Income Comparisons, Income Adaptation, and Life Satisfaction: How Robust are Estimates from Survey Data?

Der Theorie nach wird subjektives Wohlbefinden von Einkommensvergleichen und Einkommensanpassungseffekten beeinflusst. Empirische Tests dieser Effekte verwenden oft selbstkonstruierte Messgrosen aus Umfragedaten. Dieser Artikel zeigt, dass Ergebnisse sehr sensitiv gegenuber einfachen Parameterveranderungen sein konnen. Unter Verwendung groser Paneldatensatze aus Deutschland und Grosbritannien zeige ich Falle, in denen plausible Veranderungen der zugrundeliegenden Einkommensart substantiellen Einfluss auf Tests des Zusammenhangs zwischen Lebenszufriedenheit, Einkommensrang, Referenzeinkommen und Einkommensanpassung haben. Modelle die simultan fur Einkommen und Einkommensrang kontrollieren sowie Modelle mit einigen Lags der Einkommensvariable sind anfallig fur imperfekte Multikollinearitat mit entsprechenden Konsequenzen fur Prazision und Robustheit der Schatzer. Forscher sollten bei Tests von relativen Einkommenseffekten darauf achten, dass Referenzeinkommen konstruiert als Durchschnitt einer recht willkurlich definierten Referenzgruppe sowie Referenzeinkommen, das mit einer Lohngleichung des Mincer-Typs prognostiziert wird, zwei Ansatze sind, die inkonsistente Ergebnisse liefern konnen und daher moglicherweise nicht so verlasslich und valide sind, wie bislang angenommen. Die Analyse unterstreicht die Bedeutung von Robustheitschecks und Regressionsdiagnostik - zwei Routineprozesse, die in empirischen Studien oft nicht grundlich durchgefuhrt werden.

Income Comparison, Income Formation, and Subjective Well-Being: New Evidence on Envy versus Signaling

Drawing on the distinction between envy and signaling effects in income comparison, this paper uses 307,465 observations for subjective well-being and its covariates from Germany, 1990-2009, to study whether the nature of income comparison has changed in the process of economic development, and how such changes are related to changes in the nature of income formation. By conceptualizing a person’s comparison income as the income predicted by an earnings equation, we find that, while in 1990-1999 envy has been the dominant concern in West Germany and signaling the dominant factor in East Germany, income comparison was non-existing in 2000-2009. We also find that the earnings equation reflects people’s ability more accurately in the second than in the first period. Together, these findings suggest that comparing one’s income with people of the same ability is important only when ability is insufficiently reflected in own income.

The Joneses in Japan: Income Comparisons and Financial Satisfaction

This paper uses Japanese data which includes measures of self-declared satisfaction, reference-group income, and the direction and intensity of income comparisons. Relative to Europeans, the Japanese compare more to friends and less to colleagues, and compare their incomes more. The relationship between satisfaction and others' income is negative, and more negative for those who report greater income comparison intensity. A self-reported measure of others' income does better than cell-mean income in explaining satisfaction, and would arguably make a useful addition to many existing surveys.

Another avenue for anatomy of income comparisons: Evidence from hypothetical choice experiments

We propose a new avenue for studying income comparisons effects, namely hypothetical discrete choice experiments in which respondents are presented with alternative combinations of hypothetical monthly income amounts, both for themselves and certain reference persons. With this experimental method we can avoid the problems associated with researcher-imposed reference persons’ incomes that are found in most of the happiness studies testing comparison effects. This approach allows investigation of the differences in comparison effects across types of reference groups as well as respondents’ individual characteristics, including specific comparison benchmarks, which are the main open questions in the literature. Some results from our original, large-scale, Internet-based survey are provided.

Income Comparison as a Determining Mechanism of Class Identification: A Quantitative and Simulation Study Using Japanese Survey Data

AbstractThis paper questions whether personal income comparison explains the distributive gap between income and class identification by exploring the following two issues: empirical validity of income comparison as the determinant of class identification, and theoretical validity of income comparison for the distributive gap. For the first issue, we conduct a statistical analysis using data from the Social Stratification and Social Mobility surveys (1975–2005), and the Stratification and Social Psychology‐I survey (2010). We find that the criteria for choosing reference groups changed historically from residential proximity to occupational equality. In addition, income comparison with sensitive to lower‐income possessors and a distorted perception of income difference significantly affected class identification, except for the year of 1985. The simulation analysis employed to examine the second issue clarified that income comparison with the above‐mentioned features yields a less skewed distribution compared to that of class identification. The data also indicates that the empirical conditions of income are satisfied for realization of this result. Thus, we could ascertain empirical and theoretical validity of income comparison as explanation for the distributive gap between income and class identification.

In Sickness and in Wealth

As the percentage of wives outearning their husbands grows, the traditional social norm of the male breadwinner is challenged. The upward income comparison of the husband may cause psychological distress that affects partners' mental and physical health in ways that affect decisions on marriage, divorce, and careers. This article studies this impact through sexual and mental health problems. Using wage and prescription medication data from Denmark, we implement a regression discontinuity design to show that men outearned by their wives are more likely to use erectile dysfunction medication than their male breadwinner counterparts, even when this inequality is small. Breadwinner wives suffer increased insomnia/anxiety medication usage, with similar effects for men. We find no effects for unmarried couples or for men who earned less than their fiancée prior to marriage. Our results suggest that social norms play important roles in dictating how individuals respond to upward social comparisons.

Direct Evidence on Income Comparisons and Subjective Well-Being

Subjective well-being (SWB) is generally argued to rise with relative income. However, direct evidence is scarce on whether and how intensively individuals undertake income comparisons, to whom they relate, and what they perceive their relative income to be. In this paper, novel data with direct information on income comparison intensity and perceived relative income with respect to predetermined reference groups is used to provide evidence on the relationship between income comparisons and SWB. We find negative correlations between comparison intensity and SWB for co-workers, people in the same occupation and friends. For job-related reference groups income comparisons are mostly upwards and perceiving to earn less than the reference group is negatively correlated with SWB.

My Wage is Unfair! Just a Feeling or Comparison with Peers?

This paper descriptively analyzes the nexus between income comparisons and perceptions of unfair pay. A German household survey reveals that individuals who perceive their wages as unfair earn significantly lower wages than fairly paid individuals with similar characteristics. This suggests that unfairness perceptions with respect to wages are based on sound income comparisons with peers. When asked about a subjectively fair amount in Euros, individuals tend to claim much higher wages than fairly paid individuals with identical characteristics.

Where the Streets Have a Name: Income Comparisons in the Us

This paper analyses how neighbors' income affect agents' well-being using unprecedented data from the BRFSS and the City of Somerville. We conduct a multi-scale approach at the county, ZIP code and street-levels and find that the association between well-being and neighbors' income follows an inverted U-shaped pattern in the size of the area. We find a negative relationship between well-being and neighbors' income in the county of residence, but the opposite at the ZIP code-level. Our results are consistent with the fact that agents enjoy living in a rich ZIP code but also having poor faraway neighbors since they have preferences for high social status. We test explicitly this interpretation by including amenities and the relative rank in the local income distribution in our model. At the street-level, we find a negative association between neighbors' income and self-reported well-being indicating the presence of income comparisons between very close neighbors.