An Economic Model of Household Income Dynamics, with an Application to Poverty Dynamics Among American Women

CEPR Discussion Paper Series No. 1830

Posted: 16 Oct 1998

See all articles by Simon M. Burgess

Simon M. Burgess

University of Bristol - Department of Economics; University of Bristol - Leverhulme Centre for Market and Public Organisation (CMPO); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Carol Propper

Imperial College London Business School; Centre for Economic Policy Research (CEPR); University of Bristol - Leverhulme Centre for Market and Public Organisation (CMPO)

Date Written: March 1998

Abstract

The rise in inequality and poverty is one of the most important economic and social issues in recent times. But in contrast to the literature on individual earnings inequality, there has been little work modeling (as opposed to documenting) household income dynamics. This is largely because of the difficulties created by the fact that on top of the human capital issues that arise in personal earnings, individuals are continually forming, dissolving and reforming household units. This paper proposes a framework for modeling household income dynamics. It emphasizes the role of household formation and dissolution and labor market participation. It allows standard economic theory to address the issues of household, as distinct from individual, income and poverty dynamics. In this paper, we illustrate this framework with an application to poverty rates among young women in the United States. We use this model to analyze differences in poverty experiences, particularly between black and white women.

JEL Classification: D31, I32

Suggested Citation

Burgess, Simon and Propper, Carol, An Economic Model of Household Income Dynamics, with an Application to Poverty Dynamics Among American Women (March 1998). CEPR Discussion Paper Series No. 1830. Available at SSRN: https://ssrn.com/abstract=106379

Simon Burgess (Contact Author)

University of Bristol - Department of Economics ( email )

8 Woodland Road
Bristol BS8 ITN
United Kingdom
+44 117 928 8436 (Phone)
+44 117 928 8577 (Fax)

HOME PAGE: http://www.bris.ac.uk/Depts/Economics/department/profiles/burgess.htm

University of Bristol - Leverhulme Centre for Market and Public Organisation (CMPO)

12 Priory Road
Bristol BS8 1TN
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Carol Propper

Imperial College London Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

University of Bristol - Leverhulme Centre for Market and Public Organisation (CMPO) ( email )

12 Priory Road
Bristol BS8 1TN
United Kingdom

HOME PAGE: http://www.bris.ac.uk/Depts/Economics/department/profiles/propper.htm

Register to save articles to
your library

Register

Paper statistics

Abstract Views
735
PlumX Metrics