The Unassuming Economist

From a paper by Barbara Binder:

“The dissertation examines the impact of minimum wages on the development of income inequality in the USA from 1989 to 2018. In many post-industrial societies, income inequality in terms of disposable household income has risen significantly in recent decades. Since labor income is the primary income source for households in these societies, changes in wage structures can substantially influence household income distribution. Skepticism regarding minimum wages as a social policy tool remains high and is a subject of intense debate in both academia and politics.
In the USA, statutory minimum wages have increased in the median over the studied period due to state-level minimum wage hikes. Additionally, significant changes in social structure have had profound effects on the labor market and on the composition and income situations of households with minimum wage earners. Minimum wage earners are increasingly the primary contributors to household income, thus significantly determining household welfare. Concurrently, the U.S. welfare state has shifted towards targeting working individuals and their households. The income tax system has become one of the most important forms of government support, with tax refunds serving as an additional income source for households with low to moderate labor incomes. The study hypothesizes that the improved income situation of households with minimum wage earners has contributed to an increase in quantile values in the lower household income range, thereby reducing net household income inequality.
The analysis uses decompositions of unconditional quantile regressions to examine the contribution of households with minimum wage earners to changes in quantile values across the lower half of the income distribution. Various income concepts for measuring inequality and different model specifications are applied.
The results show that households with minimum wage earners, due to their improved income situations, significantly contributed to a slight increase of 1 to 2 percent in quantile values between the third and eighth percentiles of the overall population’s net household income distribution, thereby slightly reducing income inequality. This effect is somewhat stronger when households with minimum wage earners also benefit from tax refunds. These positive contributions fall below the commonly considered poverty threshold and are therefore often overlooked. Changes in redistribution systems over time did not affect the contribution of households with minimum wage earners to the income distribution. The inequality of household labor income is more strongly associated with the improved income situation of households with minimum wage earners, as quantile values in the lower range increased by approximately 5 percent. Interactions with redistribution systems thus persist, and the influence of minimum wages is mitigated when broader income concepts are considered.
These findings offer valuable insights for the discussion on the role of minimum wage policy in income inequality and its interaction with long-term developments in labor markets, welfare states, and the social structures of nations.”

From Caixin Global:

“Recent weeks have seen a flurry of multilateral diplomacy across South America. The 31st APEC Economic Leaders’ Meeting in Lima, Peru, and the 19th G20 Summit in Rio de Janeiro, Brazil, convened global leaders, including President Xi Jinping. The theme of the APEC meeting was Empowering, Inclusive, Growth, while the G20’s Rio Declaration emphasized fostering “strong, sustainable, balanced, and inclusive growth,” with the term “inclusive” appearing at least 10 times. This shared emphasis reflects a pressing global reality.”

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From Daily Excelsior:

“Leaders from various Indian-American communities have applauded Prime Minister Narendra Modi for his commitment to “inclusive growth” in India.

At the half-day Global Equity Alliance Summit, hosted at Washington Adventist University on Friday, the leaders said the minority communities in India has remained safe and secure under Modi’s governance.
The summit, held in association with the Indian Minorities Foundation and Chandigarh University, also saw the launch of the Association of American Indian Minorities. The initiative was launched against the backdrop of a series of attacks on Hindu temples in the US and Canada this year.

In recognition of Modi’s efforts towards inclusive development and minority welfare, the Washington Adventist University and the Association of American Indian Minorities honoured the Prime Minister with the Dr Martin Luther King Jr Global Peace Award for Minority Upliftment.
Chandigarh University Chancellor Satnam Singh Sandhu received the award on Modi’s behalf in his absence.

The association’s goal is to unite minorities in the country and work for the safety and security of Indian American minorities, according to the organisers here.”

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From a paper by Nauro F. Campos, Vera Z. Eichenauer, Jan-Egbert Sturm:

“The average unemployment rate in Europe has been consistently higher than in the United States since 1980. The main explanation offered by a rather large economics literature focuses on the interaction between institutions and shocks. The contribution of this paper is twofold: to assess whether this prevailing explanation still holds when we take into account recent shocks (globalisation, China, etc.) and time-varying labour market institutions; and to offer a decomposition (using the Shapley-Owen approach) of the relative contributions of shocks, institutions and their interactions. While our results confirm the general validity of the Shocks and Institutions Hypothesis, we argue that it is more complex and nuanced than originally formulated.”

From China Daily:

“The just-concluded G20 Summit marked a critical moment for global governance, and offered China a platform to share its vision of inclusive growth, equitable global governance and pragmatic cooperation. President Xi Jinping’s proposals at the G20 Summit in Rio de Janeiro, Brazil, underscored China’s commitment to upgrade its efforts with the Global South in order to address pressing global challenges.

President Xi’s emphasis on the Global South was not just rhetoric but a genuine belief in making the global governance system fairer and more representative. By championing initiatives like the Initiative on International Cooperation in Open Science and pledging to increase imports from developing countries to $8 trillion by 2030, China reinforced its role as a partner of developing countries. The approach highlights China’s broader outlooks of global affairs: fostering South-South cooperation and amplifying the voices of emerging economies on the global stage.

Xi also outlined China’s eight actions for global development, which include expanding the Belt and Road Initiative, safeguarding food security and promoting international cooperation in science and technology. This aligns with the developmental goals of the Global South — the Chancay Port inaugurated just a few days before in the region serves as a good example.”