ABSTRACT Several studies show that mortality decreases as income increases, but when studying mortality inequalities, income components matter, especially those relating to health conditions such as disability benefits. This analysis, which refers to the elderly in Italy, uses an innovative integrated database of the Population Register and the Income Integrated Database by Istat. The 2018 residents, their 2018 individual disposable income and the deaths observed during 2019 are analyzed. The disability benefits effect is assessed comparing Mortality Rate Ratios, estimated by Negative Binomial regression models, by income classes with and without disability benefits. Our findings show that the relationship between income and mortality is strongly affected by disability benefits. When these are disregarded, an income gradient emerges in mortality: lower income individuals experience higher mortality rates. In contrast, when individual income includes disability benefits, the poorer individuals show lower mortality rates because disability benefits shift the frailest individuals to higher income classes.

ABSTRACT As their populations age, Japan, the United States, and many other countries face challenging economic prospects. Due to important intergenerational linkages, members of every generation will be affected. Saving may prove to be insufficient and old‐age support systems fiscally unsound. Here we assess the proportional reduction in consumption across all ages that would be required to attain long‐term sustainability. We use a simulation model together with the most extensive data ever compiled to analyze the connections between age structure and the economy. Our goal is to root our analysis in these rich empirical measures of age‐specific economic behavior which provide a straightforward interface with the population age distribution. This approach contrasts with more theoretical models incorporating feedbacks and endogenous behavior while requiring different kinds of assumptions. Sustainability requires both cross‐sectional aggregate balance each year and longitudinal balance for each birth cohort. Specifically, we ask: “Are the baseline age profiles of consumption, labor income, savings, and intergenerational transfers sustainable in a hypothetical demographic steady state that would result from fixed fertility and mortality rates? To what extent would the age profile of consumption have to be altered to achieve sustainability?” Sustainability is calculated for each country using conditions as of three dates: several decades ago (1984 Japan and 1990 US), 2019, and 2065. We find that the intergenerational economies in Japan and the US were close to sustainable at the earlier date, but became seriously unsustainable by 2019. An even greater shortfall would occur given expected fertility and mortality rates for 2065. We discuss reasons for the deterioration in sustainability—population aging, differences in economic behavior, and public policy. Given 2019 conditions long‐run sustainability in Japan would require a 15% reduction in consumption (relative to labor income with an underlying upward trajectory from expected productivity growth). With the projected fertility and mortality conditions of 2065, a 19% reduction would be required to achieve sustainability. For the US, the corresponding reductions would be 9% for 2019 and 12% for 2065 conditions.

ABSTRACT This article analyzes the evolution of income inequality in France between 1970 and 2019 and breaks down these variations into the respective contributions of changes in family compositions, occupations, individual earnings, taxes and social benefits, using a semi‐parametric decomposition approach by sub‐periods. Earnings and retirement pensions had a strong contribution to the decline in inequality during the 1970s and 1980s, before a neutralization and even a recent reversal of the impact. Changes in family compositions, particularly the rise of single‐parent households, led to a moderate but continuous rise in inequality. The strong increase in female employment during that period did not lead to a uniform fall in inequality of household equivalized income, partly because of homogamy. Overall, direct taxes and social benefits have been more and more inequality‐decreasing across the period, although this trend was temporarily reversed during the first decade of the 21st century.

ABSTRACTDeveloped countries have addressed the challenge of improving low‐income households' housing conditions through housing allowances and social housing. In this paper, we assess the effectiveness of these policies—individually and in combination—by comparing them to a counterfactual scenario without housing support. We examine 27 European countries using harmonized data from the EU‐SILC dataset. We find that (1) cash housing benefits (housing allowances) are more cost‐effective than in‐kind housing benefits (social housing), and more effective at reducing poverty than inequality. This result holds even when accounting for a partial capture of cash housing benefits by landlords, as documented in several studies. (2) Some Nordic and Western countries—especially Finland—achieve an impressive reduction in both inequality and poverty (one‐third) while spending as much as France and the UK. By contrast, France's mixed approach, combining both policies, appears to be the least cost‐effective.

ABSTRACTIn the economic history of post‐unification Italy, the question of wealth has been largely neglected. We fill this gap with a new set of estimates of wealth concentration from 1863 to 1914, using national inheritance tax tabulations, combined with existing micro‐data for the cities of Milan and Naples. While the level of our estimates for this period is among the highest ever recorded for Italy, we find no trend, nor the classic North–South divide. The wealth of present‐day billionaires—derived using a novel long‐run “rich list” as a multiple of GDP per capita—is higher than that of the past. Private wealth and bequest flow as a share of national income follow a U‐turn dynamic, with historical and present levels aligned. Overall, the paper lays the basis for a long‐run view of wealth in modern Italy and reconsiders the impact of its industrialization at the end of the Liberal period.

ABSTRACTUsing 20 years of nationally representative panel data in South Korea, we estimate how life satisfaction responds to income shocks. We document that unexpected income changes significantly impact an individual's life satisfaction, and the magnitudes depend on the persistence of income shocks. We find that permanent income shocks substantially penetrate life satisfaction, while transitory income shocks have minimal impact. We also find that life satisfaction regarding external factors such as family income and leisure activities is more sensitive to income shocks than life satisfaction related to social relationships. Our findings imply that it is critical for the government to address persistent income losses in the economy (e.g., long‐term unemployment driven by skill‐biased technological changes or work‐limiting disability) as a means to improving social welfare.

ABSTRACTTo examine the income‐reporting behavior of individuals and households across wealth groups in India, we use new and publicly available information in election filings, along with Forbes' list and income tax data. We find that the wealthier a household is, the smaller the income it reports relative to its wealth. On average, a 1% increase in family wealth is associated with a more than 0.6% decrease in the reported income–wealth ratio. The income–wealth ratios for individuals exhibit very similar patterns. We show that tax avoidance is an important factor behind the abnormally low capital income reported by the top wealth groups. We use the national income accounts to estimate the capital income missing from tax returns. We find the average return on capital in India to be 7.2%. In contrast, the total income reported by the wealthiest 0.1% of families is only about a fifth of the returns from their capital. For the Forbes‐listed 100 families, an even higher fraction of capital income goes unreported. We demonstrate how the missing income makes the tax regime regressive with respect to wealth and results in an underestimate of inequality. Finally, we show that women report relatively less income, and individuals exposed to greater media and civil society scrutiny report relatively high incomes.

Abstract Following the inflation surge in the aftermath of the pandemic crisis, Euro Area governments adopted a large array of fiscal measures to cushion its impact on households. The inflationary shock and related fiscal measures affected households differently depending on their country, their consumption patterns, and their position in the income distribution. This paper uncovers the aggregate and distributional impact of this inflationary shock, as well as the impact of the government measures aimed at supporting households and containing prices. The analysis is carried out for 2022 and includes Germany, France, Italy, Spain, Portugal, and Greece. Our work confirms that the purchasing power and welfare of low‐income households was more severely affected than that of high‐income households. Fiscal measures contributed significantly to closing this gap, though with country differences. However, most fiscal measures were not particularly targeted at low‐income households, implying a low cost‐effectiveness in protecting the poorest in some countries.