Income Threshold Research Articles

EM Algorithm-Based Enterprise Digital Transformation: Green Innovation Efficiency of Enterprise Investment

The digital transformation of manufacturing industry refers to the integration and application of the new generation of information technology in the field of manufacturing in the context of the current digital economy development. Architecture is the foundation of the real economy, which is closely related to digital chemistry and industrial digitalization. On the one hand, high-tech manufacturing of digital information products such as terminal equipment, smart equipment, electronic components, and integrated circuits is the material basis of digital chemical industry. It is a product of traditional manufacturing, blockchain, and artificial intelligence. On the other hand, digital technologies such as simulation technology are the core of the development of manufacturing, the key to achieving precise market positioning, expanding product functions, and improving product quality and added value. Digital technology is an intellectual industry. From the perspective of investment returns, the investment behavior of enterprises is manifested as effective investment and invalid investment. If the capital cost during the investment process is lower than the company's income, the company will not increase the investment amount for any reason, so it will not receive enough investment. Due to the low threshold of investment income, investment growth exceeding a certain threshold will actually reduce investment income and lead to excessive investment. In this context, this article studies the digital transformation of corporate enterprises based on algorithms: green innovation in investment efficiency organizations. This article deeply studies the status quo and the advantages of green innovation investment in digital technology and puts forward corresponding suggestions.

Can child benefit reductions increase maternal employment? Evidence from Japan

This study estimates the policy impacts of the resumption of income thresholds for receiving child benefits (CB), in April 2012, on maternal labor market participation, childcare services use, and child health outcomes in Japan. Using data from the Longitudinal Survey of Newborns in the 21st Century and employing a regression discontinuity design, we found that the reduction of CB payments in higher-earning households, where the annual income of the household head exceeded their threshold, promoted intensive and extensive margins of maternal labor supply, especially for part-time workers and the self-employed. Furthermore, mothers returned to the workplace using non-accredited childcare and increasing the total childcare costs but having no impact on children's health outcomes. Heterogeneous effects were also observed in prefectures with low availability of accredited childcare; mothers incurring CB reduction used non-accredited childcare to start full-time employment. These findings imply that CB reduction had the advantage of encouraging maternal employment and, especially in prefectures with few childcare facilities, increasing the number of accredited childcare centers and that reducing the price of non-accredited childcare services can make it easier for mothers to return to the workforce after giving birth.

The Relationship Between Economic Growth and Income Inequality in Economies in Transition

ABSTRACT In this study, we focus solely on economies in transition. The classification of the countries into the low-income and high-income economies in transition are based on the classification of the World Bank and on our own classification based on an income threshold that is endogenously estimated by our model. We use fixed-effects and dynamic panel technique such as system generalized method of moments (GMM) estimation in our analysis to mitigate endogeneity problem. Our empirical study uses dynamic econometric models to examine the relationship between income inequality and economic growth in the economies in transition. We find a positive relationship between income inequality and economic growth in high-income economies in transition, which is in stark contrast with the negative relationship for low-income economies in transition. We also find that inflation rate negatively and significantly affects economic growth in the low-income economies in transition, while it positively and significantly affects economic growth in the high-income economies in transition. We estimate an income threshold endogenously and reestimate both regressions according to our own threshold. Importantly, the contrasting qualitative difference (between low-income economies in transition and high-income economies in transition) in the relationship between income inequality and economic growth is robust whether we follow the World Bank’s classification of economies in transition or whether we classify them accordingly to what the data in our sample suggest.

The Impact of Financial Assistance Programs on Health Care Utilization: Evidence from Kaiser Permanente.

Most hospitals have financial assistance programs for low-income patients. We use administrative data from Kaiser Permanente to study the effects of financial assistance on healthcare utilization. Using a regression discontinuity design based on an income threshold for program eligibility, we find that financial assistance increases the likelihood of an inpatient, ambulatory and emergency department encounter by 3.6 pp (59%), 13.4 pp (20%), and 6.7 pp (53%), respectively, though effects dissipate three quarters after program receipt. Financial assistance also increases the detection and management of treatment-sensitive conditions (e.g., drugs treating diabetes), suggesting financial assistance may increase receipt of high-value care.

The economic efficiency of aid targeting

How efficient is the targeting of foreign aid to populations in need? A long literature has focused on the impacts of foreign aid, but much rarer are studies that examine how such aid is allocated within countries. We examine the extent to which donors efficiently respond to exogenous budget shocks by shifting resources toward needier districts within a given country, as predicted by theory. We use recently geocoded data on the World Bank’s aid in 23 countries that crossed the lower-middle income threshold between 1995 and 2010 and thus experienced sharp aid reductions. We measure locations’ need along a number of dimensions, including nighttime lights emissions, population density, conflict exposure, and child mortality. We find little evidence that aid project siting is increasingly concentrated in worse-off areas as budgets shrink; the only exception appears to be a growing share of funding in more conflict-affected areas. We further analyze the relationship of health aid to child mortality measures in six key countries, again finding little evidence of efficient responses to budget shocks. Taken together, these results suggest that large efficiency gains may be possible in the distribution of aid from the World Bank and other donors.

Measuring well-being and lives worth living

We study the measurement of well-being when individuals have heterogeneous preferences, including different conceptions of a life worth living. When individuals differ in the conception of a life worth living, the equivalent income can regard an individual whose life is not worth living as being better off than an individual whose life is worth living. In order to avoid this paradoxical result, we reexamine the ethical foundations of well-being measures in such a way as to take into account heterogeneity in the conception of a life worth living. We derive, from simple axioms, an alternative measure of well-being, which is an equivalent income net of the income threshold making lifetime neutral. That new well-being index always ranks an individual whose life is not worth living as worse-off than an individual with a life worth living.

Distributive Justice, Democracy and Growth

This paper argues that the effect of income inequality on economic growth depends on the level of democracy in a country and whether people believe that redistribution is an essential component of the democratic process. The paper uses the World Values Survey to focus on countries where the majority believe that taxing the rich and subsidizing the poor an essential component of democracy, and on countries where the majority believe that the rich do not buy elections in their country. Using the threshold estimation technique introduced by Hansen (1999), the analysis suggests the presence of a statistically significant threshold income inequality level, below which democracy does not have a statistically significant effect on growth, and above which an increase in the dose of democratization has a statistically significant negative effect on economic growth. The interpretation is that in countries where income inequality is high, and the majority believe that taxing the rich and subsidizing the poor is an essential component of democracy, a higher level of democratic governance allows people to support redistribution policies which can deter investment and economic growth.

How many people is the COVID-19 pandemic pushing into poverty? A long-term forecast to 2050 with alternative scenarios.

The COVID-19 pandemic has changed the course of human development. In this manuscript we analyze the long-term effect of COVID-19 on poverty at the country-level across various income thresholds to 2050. We do this by introducing eight quantitative scenarios that model the future of Sustainable Development Goal 1 (SDG1) achievement using alternative assumptions about COVID-19 effects on both economic growth and inequality in the International Futures model. Relative to a scenario without the pandemic (the No COVID scenario), the COVID Base scenario increases global extreme poverty by 73.9 million in 2020 (the range across all scenarios: 43.5 to 155.0 million), 63.6 million in 2030 (range: 9.8 to 167.2 million) and 57.1 million in 2050 (range: 3.1 to 163.0 million). The COVID Base results in seven more countries not meeting the SDG1 target by 2030 that would have achieved the target in a No COVID scenario. The most pessimistic scenario results in 17 more countries not achieving SDG1 compared with a No COVID scenario. The greatest pandemic driven increases in poverty occur in South Asia and sub-Saharan Africa.

근로장려금과 복지함정 및 역선택

This paper empirically analyzes whether earned income tax credit (EITC) has induced the welfare trap and/or the adverse selection problem. In contrast, previous studies have focused on the effects of EITC on labor income/hours or the labor market participation. With the introduction of EITC, some households may strategically maintain their income below the income threshold level of EITC, called the welfare trap. Also some households may even reduce their income to move below the income threshold level, called adverse selection. Based on the Korean Welfare Panel Study data, this paper does not find the welfare trap, but does find the evidence consistent with the adverse selection problem. These results provide important insights on the recent policy debates between the universal welfare and the selective welfare.

The impact of vocational rehabilitation on employment outcomes: A regression discontinuity approach.

Since 2015, Finnish disability pension applicants who are rejected or receive a short-term temporary pension have, under certain conditions, also received a preliminary decision for vocational rehabilitation (VR). A key requirement for eligibility is a certain amount of earnings during the previous five years (€34 910.29 in 2017). We exploit this discontinuity to examine the impact of assignment to VR on labor market outcomes. All new disability pension applicants from 2015 to 2017 were included. Fuzzy regression discontinuity design was used to evaluate the impact of assignment to VR on employment, unemployment and earned income two years later among those close to the threshold (+/- €20 000) providing eligibility for the preliminary decision. Arguably, those just below and just above the earnings limit are similar to each other, allowing causal interpretation of the estimates. For each of the employment outcomes, we found a modest effect in the expected direction at the income threshold, but there is considerable uncertainty in these findings. On average, exceeding the income limit increased the probability of employment by 7.6 percentage points, but the estimate was far from statistical significance. Unemployment became slightly less common and earned income slightly increased, but the estimates were also clearly statistically non-significant. We found no consistent evidence of the impact of assignment to VR on employment outcomes among low-income disability pension applicants. However, given the narrow and specific study population, this should not be taken as evidence of ineffectiveness of VR more generally.

RESPONSE TO DAVID BLAU'S ESSAY

RESPONSE TO DAVID BLAU'S ESSAY

Economic complexity, ICT, biomass energy consumption, and environmental degradation: evidence from Iran.

Economic complexity, biomass energy consumption, and information communication technology (ICT) have diverse impacts on energy consumption and carbon dioxide (CO2) emissions. Nevertheless, analysis of these variable effects is not addressed in the previous literature; the antiqueness of this article is stuffing this gap. This study assessed the relationship between gross domestic product (GDP) per capita, biomass consumption, economic complexity index (ECI), ICT, and CO2 emissions in Iran in 1994-2018. The autoregressive distributed lag (ARDL) model and the quantile regression (QR) econometric technique were used to investigate the factors affecting CO2 emissions in the tails of the conditional distribution. The share of each influential factor was predicted through the variance decomposition analysis (VD) for the next 10years. The empirical results showed a long-run relationship between the variables. So, the variables of biomass consumption, ECI, and ICT improve the quality of the environment in Iran by reducing CO2 emissions, and the per capita GDP variable increases CO2 emissions. Results suggest no evidence indicating the presence of environmental Kuznets curve (EKC); however, QR demonstrated the existence of EKCs in the lower quantiles of the conditional distribution. The ECI will have the most share to change the CO2 emissions in the future. The income threshold should be determined at the turning point of the EKC to increase economic development. Moreover, investing in increasing biomass consumption is vital. Policymakers also need to consider strict added value for the export of products.

THE IMPACT OF MONETARY POLICY ON HOUSING AFFORDABILITY IN MALAYSIA

Housing affordability is a global concern, especially among researchers and policymakers around the world in both developed and developing countries. In Malaysia, it has been a decade since the median multiple house price reaching more than a tripled median household income threshold in term of housing affordability. This indicates that housing in Malaysia is seriously unaffordable. In general, this study was conducted to examine the impact of monetary policy on housing affordability in Malaysia. This study focuses on investigating both short and long-run relationships between money supply and interest rate on housing affordability. To achieve this goal, Autoregressive Distributed Lag (ARDL) estimation techniques were employed on a quarterly data from the first quarter of 2008 until the first quarter of 2021. The findings showed the existence of long-run cointegration between all indicators except for the interest rate. In addition, money supply, interest rate, and employment were found to be significant in the short run. In the matter of policy implication, it is best for policymakers to focus on regulating money supply rather than controlling interest rate in promoting housing affordability.

Employee income, premium pricing, and high deductible health plan enrollment

ABSTRACT Employer health plan premiums are often subsidized at different levels according to enrollee income. When enrollees cross an income threshold, they lose some of the income-based subsidy resulting in higher premium prices for their plan choices. We use these discontinuous subsidy reductions, which induce relative price changes across plans, to assess the relationship between premium price and plan choice for workers in a large, national firm. We segmented individuals by income into $100 bins surrounding a $40,000 subsidy threshold and $200 bins surrounding a $110,000 subsidy threshold. We plotted these bins to visualize potential discontinuities and then estimated regression models that fit linear trends to the binned data at each subsidy threshold. Higher income workers were more likely to enrol in high deductible health plans (HDHPs) when those plans became relatively cheaper compared to traditional plans (estimate = −0.057, standard error = 0.027; p-value = 0.02). In contrast, lower income workers were less likely to enrol in a HDHP when the relative price fell (estimate = 0.065, standard error = 0.029, p-value = 0.03). Our findings indicate that responses to relative price distortions between insurance plan options differ by income and that benefit design should account for such heterogeneity.

Evaluation of the Family 500+ Programme: National and International Perspectives

Adopted in April 2016 and then amended in July 2016, the Family 500+ programme is the controversial programme of Polish government, which actually supports all families with children by direct cash payments of PLN 500 without any income threshold. This article aims to evaluate the effectiveness of Family 500+ programme in accordance with its three declared goals, mainly to increase the fertility rates, to reduce poverty among families with children and to invest in families in general. The main research question is the following: does the Family 500+ programme reach its goals and at what costs? The hypothesis of the paper is built upon controversy regarding this programme, mainly a number of negative effects that might be caused by this initiative (e.g. a decrease in women’s professional activity) and its non-justification (unfair distribution of resources and political motives). The research method of this paper consists of desk review of relevant data from the Central Statistical Office (GUS) and Eurostat, as well as a range of elaborations conducted by independent researchers. This paper consists of three parts. The first one is devoted to an international perspective, where there is presented an overview of family and child benefits expenditures among European countries and their impact on fertility rates. The second part presents a full range of Polish family and child benefits and the place of the Family 500+ programme within this system. The third section evaluates the implementation of direct goals of the programme, as well as its “side effects”. The conclusive part provides a summary, as well as further ideas regarding the programme improvement. The conclusions are still unclear. The first section proved that high child benefits do not guarantee high fertility rates and vice versa . The second part undermined credibility of the Family 500+ programme as a system of appropriate benefits with income threshold had already presented before. The third section contains a few conclusions: the first one is that there is no reason to argue that the Family 500+ programme increased Polish fertility rates; secondly, in addition to improving the economic situation of the poorest families with children, the lack of income threshold in the programme means unnecessary expenditures on families with good economic conditions; thirdly, an engagement of Polish women in labour market decreased since the implementation of the Family 500+ programme, which has negative effects on Polish economy.

Long-run trends in top income shares: The role of income and population growth

This paper studies the sensitivity of long-run trends in top income shares to differences in top-share measures. While the standard measure fixes a share of the population, we define alternatives that allow variation in both incomes and size of the top group based on defining absolute income thresholds. In an application to United States data, we find that top income share trends over the past century vary somewhat depending on the measure used. Allowing top groups to increase in size after 1980 along with overall economic growth results in a larger increase of top income shares. The historical drops before WWII are sensitive to the choice of income deflator: using GDP inflates interwar top income shares but using CPI deflates them. Altogether, these results recommend using complementary approaches to defining top income groups when measuring long-term top income share trends.

Energy consumption and income of the poor in rural China: Inference for poverty measures

In this study, we investigate the relationship between energy consumption and income of poor rural households in China and recover measures for relative poverty from household energy demand of the poor. With novel data collected from 16 counties in eight provinces of China, we apply semi-parametric energy demand models to capture the nonlinear relationship between income and energy consumption and parametric models to find the effect of income on energy demand within different groups. The relative poverty line is inferred from the empirical results of demand models and is defined as the income threshold point after which household energy consumption begins to rise significantly. As a result, we find that the poor household's demand for energy increases with income after a threshold point, and the relative poverty line of rural households in China is estimated at 5153.47 yuan per capita in 2015. Our results suggest that when a poor rural household's income passes the relative poverty threshold, its increasing energy demand comes primarily from biomass and non-clean commercial energy. The findings of this study suggest policies to support energy transition and upgrade in rural China and stimulate rural households to substitute non-clean energy with clean energy.

Linking Industrialization and Education in Sub-Saharan African Countries

Several works have studied the consequences of industrialization on macroeconomic variables. However, the relationship between industrialization and education has not yet been studied, especially in sub-Saharan Africa (SSA). The objective of this study is to fill this limitation of the literature by analyzing the direct effect of industrialization on education in 23 SSA countries during the period 2000-2018. Moreover, we analyzed the indirect effect between the two variables through the transmission channels. To achieve our objective, we mobilized the Driscoll and Kraay methods and System GMM. The results reveal that there is a negative and significant relationship between industrialization and education. Moreover, urbanization and per capita income are transmission channels that contribute to mitigating this negative effect. Finally, our results show that the positive impact of the processing sector on education in SSA is conditioned by the achievement of a certain per capita income threshold and a certain urbanization threshold.

Taxation of the Natural Persons’ Incomes Based on Income Rules

The purpose of this paper is to present the specific features of income taxation of the self-employed population, based on income thresholds. Income thresholds are a fixed amount established by the General Regional Directorates of Public Finances for several economic activities performed by self-employed population and represent the taxation base for the income tax of self-employed persons. Our objective is to provide some guidelines on this method of taxation, given the increase of self-employment in recent years in Romania.

A whole-population approach is required for dementia risk reduction

A whole-population approach is required for dementia risk reduction