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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractWe assemble data from several different sources to examine the cross-national effects of inequality and trust on social expenditures. We find that the inequality between the middle classes and the poor (as measured by the 50/10 percentile ratio) has a small, positive impact in social spending; but inequality between the ends of the distribution and middle class (measured by the 90/50 percentile ratio) has a large and negative impact on social spending. Different measures of trust are shown to have a large and positive impact on spending, implying that more cohesive, trusting societies are more willing to share economic resources with others not so fortunate. Our results suggest that as the "rich" become more distant from the middle and lower classes, they find it easier to opt out of public programs and to buy substitutes for social insurance in the private market. This funding implies that over time rising inequality will erode support for social institutions and social spending that provides insurance against income loss, upward mobility for the disadvantaged, and equality of opportunity for all citizens. . "America's high earners-the fortunate top fifth-thus feel increasingly justified in paying only what is necessary to insure that everyone in their community is sufficiently well educated and has access to the public services they need to succeed" -Reich (1991)Economic inequality, either actual or perceived, plays an important role influencing the set of goods and services that are subsidized by the public sector. Public expenditures on defense, police and fire services, roads, foreign aid, or research and development may (or may not) have benefits for all citizens. However, aside from those directly employed in these activities, such expenditures do not directly affect the well-being of households. In this paper, we focus instead on public expenditures that provide income or goods and services directly tohouseholds. This implies that we are primarily concerned with public expenditure on the provision of "private goods," including cash and near-cash transfers. 1In this paper, we first document the trends in social spending as we have defined it and quickly review that existing literature that links social expenditures and inequality. We then construct and estimate a new model of the empirical relationship between inequality and social expenditures. Our main questions deal with the effects that inequality and trust h...

From the mid-1980s to the early 1990s, several important studies examined the statistical relationship between the U.S. official poverty rate and overall economic performance. Most of these studies focused on the apparent break in this relationship beginning in the late 1970s or early 1980s. In this article, we present the results of our study of the relationship between macroeconomic performance and the poverty rate, using annual time-series data on macroeconomic variables, such as the unemployment rate and per-capita GDP growth from 1959 through 1998. Like these earlier studies, we also find that economic performance had a smaller antipoverty effect during the 1970s and 1980s than it did in earlier years. However, our estimates suggest that the weakened economic growth-poverty relationship may have been an aberration of this period and that the expected relationship of the 1960s has again been reestablished in the 1990s. This is true even after accounting for changes in earnings inequality over the entire period. Copyright 2000 Western Economic Association International.

Once upon a time, a picture was worth a thousand words. But with online news, blogs, and social media, a good picture can now be worth so much more. Economists who want to disseminate their research, both inside and outside the seminar room, should invest some time in thinking about how to construct compelling and effective graphics.