Saturday, February 22, 2014

Marry in haste...

Repent if your mate prefers leissure, because you're responsible for the increase in income inequality, say four (three Europeans!) economists;
Suppose that there are only two types of people, equal in numbers, those that went to college and those who did not. Those who went to school earn $30 and those who did not earn $10. If educated men marry uneducated women and uneducated men marry educated women, then every household will earn $40 in total. So, household income is perfectly equalised. Now, imagine a world in which educated people only marry other educated people. Then, a household made up of an educated man and an educated woman will earn $60 versus the $20 earned by a household that consists of only uneducated spouses. The households at the top of the distribution would have three times the income of those at the bottom.
Obviously, the example above is a dramatic simplification of reality, but it does capture an important trend that is actually taking place in the US economy. To study its impact, we track samples of hundreds of thousands of households from the US Census Bureau for the period 1960 to 2005 (see Greenwood, Guner, Kocharkov and Santos 2014). The upshot of the analysis is that rising assortative mating together with increasing labour-force participation by married women are important in order to account for the determinants of growth in household income inequality in the US.
Ball in Kshama's court;
Sawant grew up in Mumbai where she later studied computer science and graduated with a B.Sc from the University of Mumbai in 1994. Sawant married her husband Vivek, an engineer at Microsoft, and moved to the United States.[11] After moving to the United States Sawant decided to abandon the computer engineering field. She began to pursue study in economics due to what she described as her own "questions of economic inequality."
Tighten the immigration laws, decrease inequality!

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