Inequality and Economic Policy

Essays In Honor of Gary Becker

Tom Church, Chris Miller, John B. Taylor, Tom Church, Chris Miller, John B. Taylor

• Publisher: Hoover Institution Press
• Year: 2015
• Print ISBN: 9780817919047
• eBook ISBN: 9780817919061
• Edition: 1
• Topic: Economics
• Subtopic: Economic Theory
• Index: Economics

Drawing from a 2014 Hoover Institution Conference on Inequality in honor of Gary Becker, a group of distinguished contributors explore various measures of inequality in America and address the issue of whether or not it is increasing. In looking at this question and examining policy implications, the authors draw on research on human capital and intergenerational mobility. The authors suggest that the emphasis on inequality and redistribution, while not wrong, is nevertheless misplaced, for it may lead us to adopt policies that will disrupt the progress we have made while doing nothing to promote the kind of growth that is essential to national progress.

Index

ACA. See Affordable Care Act

adjusted gross income (AGI), 25, 26f

Affordable Care Act (ACA)

—ARRA of 2009 and, 95

—COBRA compared to, 108

—cronyism and, 155

—employer penalty with, 96–97

—market exchanges and, 96, 97, 98f, 99

—marriage and, 106

—measures of wages, 101f

—RomneyCare and, 109

—safety net rules compared with work hours, 100f

—taxes, 94f, 99f, 100f, 101f, 106

Africa, 150

African Americans, 149, 160, 173, 176, 183

agenda

—with confiscatory taxation, 147–48

—politics and, 156–58

AGI. See adjusted gross income

AIG, 44–45

Alliance for School Choice, 169

American Economic Review, 20

American Recovery and Reinvestment Act. See ARRA of 2009

answer. See question and answer

Antoinette, Marie, 151

ARRA (American Recovery and Reinvestment Act) of 2009, 95

asset tax, 95

athletes, salaries for professional, 33f

Avery, Chris, 130, 134

avoidance, of taxes, 138–39

Baby Boomers, 116–17

Bakija, Jon, 27

banks

—Grameen Banks, 166–67, 175–76

—wealth tax and, 10

Bechtel, 188

Becker, Gary

—consumption patterns and, 184

—with economics of discrimination, 183

—human capital and, 72, 130, 185

—income inequality and, xv–xvi

—influence, 17, 65, 91–92, 186, 188

—Lazear on, 181–87

—legacy, xvi, 20, 181–82

—Nobel Prize and, xv, 186

—Shultz on, 188–90

behavior, taxes and, 138–39

billionaires

—in China, 46–47

—wealth of non-US and US, 39f, 40

Black-Scholes, 22, 42

BLS (Bureau of Labor Statistics), 143

Blueseed boat, 165

Bogle, John, 41

bonds

—municipal, 141

—stocks and, 6, 10, 13

borrowing constraints, 134

Brown, Jerry, 134, 169–70, 175

Buffett, Warren, 10

Bureau of Labor Statistics. See BLS

Bush, George H. W., 171

Bush, George W., 171

businesses

—business dynamism, 62

—Forbes 400 and generation of wealth-creating, 34, 35f

—life cycle of, 164

—with micro lending, 166, 172

—private companies, 27–29, 28f

—publicly traded companies, 21–29, 23f, 24f, 25f, 26f

—start-ups, 163–65. See also industries

buzzword, inequality as meaningless, 156, 176

California

—education in, 160–62, 170

—math proficiency rate in, 160

—with prison guard salaries, 174–75

—recidivism rate, 174

—teacher dismissal rate in, 161

—Vergara v. California, 161–62

California Correctional Peace Officers Association, 174, 175

California Public Employees’ Retirement System (CalPERS), 41–42

capital, physical, 133. See also human capital

capital gains

—income converted into, 138–39

—income from, 6, 10, 18, 19f. See also bonds; stocks

Capital in the Twenty-First Century (Piketty), 2, 21

capitalism

—inequality fundamental to, 3

—tripartite division of, 3–4

Caplan, Bryan, 85

carbon tax, revenue-neutral, 190

cartelization, of economy, 12

Carter, Jimmy, 13

CEO pay

—with ex-ante pay, 21–22, 23f, 25, 26f

—hedge-fund managers to total ex-ante pay of S&P 500, 30, 31f

—in publicly traded companies, 21–27, 23f, 24f, 25f, 26f

—with realized pay, 22, 23, 24f

—regulation of, 147

—with S&P 500 net income (1993–2012), 24, 25f

charitable giving, 139

Chetty, Raj, 131–32, 162

children

—daughters, 85, 185

—divorce rate in families with, 186

—early childhood intervention, 178–79

—employment rate for teens, 177

—enrichment expenditures per child, by parental income, 70, 71f, 74–75

—human capital and, xvii, 72–76, 82, 85, 130, 187

—mothers with “cost of a child,” 184–85

—sons, 67, 68f, 69, 69f, 70f, 74

—student debt and, 87, 137

China, 14, 145, 150

—billionaires in, 46–47

—education in, 160

—with poverty, 165–66

climate change, 157

clinics, health, 167

Clinton, Bill, 15

COBRA

—ACA compared to, 108

—subsidies, 94–95

Cochrane, John H., 166, 176, 178, 180

college

—college earnings premium, 66, 67f

—community colleges, 174

—with huma...

Table of contents

• Cover
• Series Page
• Title Page
• Copyright
• Dedication
• Contents
• List of Tables and Figures
• Acknowledgments
• Introduction
• One. Background Facts
• Two. The Broad-Based Rise in the Return to Top Talent
• Three. The Economic Determinants of Top Income Inequality
• Four. Intergenerational Mobility and Income Inequality
• Five. The Effects of Redistribution Policies on Growth and Employment
• Six. Income and Wealth in America
• Seven. Conclusions and Solutions
• Eight. Remembering Gary Becker
• Conference Agenda
• About the Contributors
• About the Hoover Institution’s Working Group on Economic Policy
• Series List
• Index