The previous post in this blog discussed the positive dynamic effects of conditional cash transfer (CCT) programs in Mexico and Nicaragua – in particular on asset accumulation and the incidence of entrepreneurship by the rural poor.
As the United States prepares for its first presidential election after the Great Recession, inequality has emerged as a central political issue. This is not unremarkable: Americans have historically seemed much less troubled by income differences than, say, Europeans. You may remember a 2004 article by Alberto Alesina, Rafael di Tella and Robert MacCulloch in the Journal of Public Economics, which reported that happiness in the US was much less sensitive to inequality than in Europe.
Update: As if on cue, the Washington Post published an article (on January 19, 2012, 3:42 PM EST) that says:
In the 1960s, black and white individuals in the United States had radically different labor market outcomes. In 1962, the unemployment rate for African-Americans was 13 percent while it was only 6 percent for whites. Fifty years have passed, enough time for Martin Luther King to go from movement leader to monument, but as of 2010, the unemployment rate in the U.S.
Given the massive debate in the U.S. about government health insurance, the just released results of a new experiment are justly making headlines. In 2004, the state of Oregon, due to budgetary shortfalls, closed its public health insurance program for low-income people. In early 2008, the state decided it had enough budget to fund 10,000 new spots. Given that it expected demand for these new slots to far exceed supply, the state Government opened up a sign-up window, getting 90,000 people to sign-up for a waitlist, and then used random lottery draws to select people from the waitlist.