Abstract:The deficiencies of the Deininger and Squire data set on household income inequality are well known for its sparse coverage, problematic measurements, and the combination of diverse data types into a single data set. Yet many studies have relied on this data due to the lack of available alternatives. In this paper we show how the UTIP-UNIDO measures of manufacturing pay inequality can be used, with other information, to estimate measures of household income inequality. We take advantage of the systematic relationship between the UTIP-UNIDO estimates and those of Deininger and Squire. The residuals from this exercise provide a map to problematic estimates in the Deininger and Squire data, and the estimated coefficients provide a way to construct a new panel data set of estimated household income inequality. This new data set provides comparable and consistent measurements across space and through time that Deininger and Squire's data do not pass.2

T he concept of a natural rate of unemployment, or nonacceleratinginflation-rate-of-unemployment (NAIRU), has ruled macroeconomics for about 25 years. Yet it is still controversial. A wide range of views exists over how the NAIRU should be estimated, a fact that in itself raises questions about the practical usefulness of the concept.This essay presents a brief for no-confidence, in four parts. First, the theoretical case for the natural rate is not compelling. Second, the empirical evidence for a vertical Phillips curve and the associated hypothesis that lowering unemployment past the NAIRU leads to unacceptable acceleration of inflation is weak, and has become much weaker in the past decade. Third, viewed collectively, attempts to estimate the location of the NAIRU have become a professional embarrassment; disagreements remain on too many basic issues. Fourth, adherence to the concept as a guide to policy has major costs and negligible benefits. Conversely, the risks of dropping the natural rate hypothesis are minor, while the benefits from a sustained pursuit of full employment could be substantial.

Abstract:In this paper we use a previously neglected, high-quality data source to generate consistent annual measures of income inequality by state, for the fifty United States and the District of Columbia from 1969 to 2004. We use the estimates in a model of presidential election turnout and outcomes at the state level from 1992 to 2004. In recent elections, we find that high state inequality is negatively correlated with turnout and a positively correlated with the Democratic vote share, after controlling for race and other factors.

Abstract:This essays surveys some of the work of the University of Texas Inequality Project, a small research group that for the past decade has worked primarily to develop new measures of economic inequality, using a method based on the between-groups component of Theil's T statistic. In this way, inequality statistics can be computed from many diverse and mundane sources of information, including regional tax collections, employment and earnings, census of manufacturing, and harmonized international industrial data sets. The rich data environment so constructed permits new analyses of patterns of economic change, by region, by sector, and by country, and broadly supports the idea that the movement of inequality is closely related to macroeconomic events at the national and the global level.

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