As documented in Auerbach, et. al. (1995), the postwar period has witnessed a dramatic increase in the annuitization of the resources of America’s elderly. Socialsecurity appears to be the main force behind this process, but Medicare, Medicaid, and private defined benefit pensions also play an important role in replacing household wealth accumulation with survival-dependent old-age resource streams. Gokhale, et. al. (1996) suggest that the increased annuitization may explain the significant postwar rise in the propensity of the elderly to consume their remaining lifetime resources. Gokhale, et. al. (2000) considers a related point, namely, that increased annuitization will reduce bequests. This is particularly the case for lower and middle-income households, who face socialsecurity taxation on all of their earnings. In differentially disenfranchising the children of the poor from the receipt of inheritances, socialsecurity may be materially altering the distribution of wealth. This paper builds on Gokhale, et. al. (2000) in trying to understand how socialsecurity and otherfactors affect wealth inequality.
This version of the paper, to provide a first investigation, uses a dynastic framework that abstracts from life-cycle features, ignores the socialsecurity (public pension) sys- tem, and highly simplifies the health insurance system. As these institutional factors have important implications for saving behaviors, they should be accounted for to al- low for a more precise investigation as an extension. As such, the simplified calibration described in section 3 must be improved in a manner corresponding to the extended model.
So, we can concentrate on 𝛽, which is a multiplier, to obtain a simple, easy-to-use, first-order approximation of the impact of administrative costs (𝛼]) on the lost rate of return. Moreover, we note that 𝛽 tends to one as 𝑡 decreases, but depending on the parameters and in the medium horizon of 𝑡, 𝛽 can be quite large, as becomes evident in the illustrations presented in the next section. So, when measuring the impact of administrative costs in terms of the multiplier 𝛽, which is larger than 1, we see that it can grow rapidly. (The second- order effect is in the same direction.) According to (20) we also see that for analyzing the effect of administrative costs on the median rate of return it is necessary to fix the level of risk factors. For illustration, Example 1 uses different values of the probability level 𝛾; namely, 𝛾 = 10%, 5%, 1%, and 0.1%. Additionally, the values of 𝑟, 𝜇, 𝜎, ], and 𝛼 also need to be fixed, according to realistic scenarios for generic investment products. In Section 6, parameter values for low, medium, and high volatility scenarios are proposed and used in the illustration of the impact of administrative costs.
Ours is not the first study to examine the demographic aspects of housing wealth effects. Campbell and Cocco (2007) employ micro data, and find that older homeowners (those over forty) exhibit greater wealth effects than those under forty. This finding is consistent with older homeowners being net long housing due to anticipated downsizing; however, the authors only divide their age groups into “old” and “young”, making no allowance for middle age. Attanasio, et al. (2009) divide age groups into three categories: young (under 35), middle-aged (35-60) and old (over 60). They find that their estimated housing wealth effect is larger for the young than the old. Since the young are not likely looking to trade down, and are more likely to include non-homeowners, the authors believe that the estimated wealth effect likely reflects omitted factors. In particular, consistent with Sinai and Souleles (2005), we would note that young people are most likely to suffer from credit constraints, and thus the impact of house prices on the consumption of the young may well represent an effect of home values on consumer spending.
dence - it connects i’s utility with j’s share. In this formulation, it is easy to see that irrespective of the opportunity level, the responder’s behaviour in a UG always remains the same. Hence, proposers’behaviour will also remain una¤ected by the opportunity level as well as the ex-post inequality in allo- cation. The other stream of argument is based on reciprocity and permits the preference over outcome to depend on the context in which the outcome was reached . Although context dependence sounds promising in our setup, none of the models explain (see Rabin (1993) for instance) the association between allocation and opportunity. In particular, note that, all these models are ‘continuous’in nature and will be unsuitable to explain the discontinuous jump, we observe, between no opportunity and positive opportunity settings. Here, we demonstrate that a simple combination of inequality aversion model with Nozick’s symbolic utility can be consistent with our observation. It would be proper to mention at this stage that our aim is no broader than that. We neither claim this to be the only possible explanation nor we propose symbolic utility to be the basis of a new social utility model. The analysis we sketch here are rudimentary and left many important questions unanswered.
If independent living is a normal good then examining the living arrangements of retirees pro- vides some clues about their financial wherewithall. I therefore examine the effect of Union Army pensions on living arrangements. The impact of pensions on living arrangements is theoretically ambiguous. The decision of older men and their kin to share living quarters is a function of income, including pension income, and prices, including shadow prices, faced both by the older men and their relatives. Such demographic variables as kin availability and such institutional variables as the rules of the Union Army program can be thought of as affecting the shadow price. The impact of these income and price variables on living arrangements will depend on the underlying model of living arrangements, the preferences of individuals, and household decisions made throughout the life cycle. For example, under a bargaining model if a man preferred to live on his own then a sizable government transfer would enable him to do so whereas if he preferred to live with rel- atives then it would enable him to bribe them. Under an altruism model a government transfer might either wholly or partially displace children’s transfers and therefore have either no or very little impact on the living arrangements of older men.
is essential to replicate the level of wealth inequality in the data. It is important to recognize that this is no diﬀerent from the models that we build upon. Aiyagari (1994) already points out that the persistence of the process that governs households’ earnings streams is key in explaining wealth inequality. This argument is elaborated further by Quadrini and R´ıos-Rull (1997). The literature has explored several mechanisms that could amplify the eﬀects of uninsurable labor shocks on the level of wealth inequality. For instance, Huggett (1996) examines the role of retirement and SocialSecurity. Quadrini (2000) and Cagetti and Nardi (2005) study the interaction of uninsurable idiosyncratic labor risk and occupational choice, whereas Krusell and Smith (1998) and Carroll (2000) resort to changes in preferences to account for the observed level of wealth inequality. These papers have various degrees of success in jointly accounting for the observed level of earnings and wealth inequality but all of them stress the diﬃculty in reproducing the observed level of wealth inequality when the level of idiosyncratic labor risk is estimated using the PSID. Indeed, this is why Casta˜ neda, D´ıaz-Gim´ enez, and R´ıos-Rull (2003) construct an earnings process that allows them to jointly account for the observed wealth and earnings inequality rather than use an earnings process estimated directly from the data. They show that the degree of earnings variability needed to account for the observed level of wealth inequality is much larger than the one estimated using the PSID. Our calibration exercise is similar to that of Casta˜ neda, D´ıaz-Gim´ enez, and R´ıos-Rull (2003).
Binomial distribution whereas social science journals fit Poisson distribution model. Both IF distributions were positively skewed – the SCI much more than the social science – indicating excess variance. Tol (2009) found that famous papers by famous authors are cited most. This implies that there are ‘increasing returns to scale’ in influence, and that Merton’s (1968) Matthew effect is real and can be found in data believing that recognized authors gain more recognition as Merton argued. However, the Matthew effect as defined and measured here implies that the relationship between citation numbers and quality is different at the top end of the distribution than at the bottom end. Mishra (2010 b) found that Burr-XII, Dagum or Johnson SU distribution are the best fit to logarithmic of JIF using data on JIF of the major discipline groups (such as Chemistry, Statistics, Psychology, Economics, Engineering, Physics, Biology and Social Sciences) for 2006 and found statistical distribution of JIF is characteristically asymmetric and non-mesokurtick. Even the distribution of log 10 (JIF) exhibits conspicuous and non-mesokurticity. He then concluded that Johnson SU distribution is the best choice to fit the log 10 (JIF) data. The distribution of log 10 (JIF) has become more skewed and leptokurtic, possibly suggesting the Matthew effect in operation, which means that more cited journals, are cited even more over time. Mishra (2010 c) studied the over- the-sample stability of the estimated parameters of statistical distributions of JIF data of 2008. His findings are based on empirical work and he concluded that Johnson SU distribution exhibits the stability for logarithmic of JIF-2008 data which will be the best fit here and forecasts the same to be in other years too. Pan and Hong (2011) briefly analyzed the 2009 publication status based on empirical findings only and concluded that there is a significant increase in number of scientific papers related to a specific area as dental due to more care taken by government.
There has been much recent research on the world distribution of income, but also growing recognition of the importance of other contributions to well-being, including those of household wealth. Wealth is important in providing security and opportunity, particularly in poorer countries that lack full social safety nets and adequate facilities for borrowing and lending. We find, however, that it is precisely in the latter countries where household wealth is the lowest, both in absolute and relative terms. Globally, wealth is more concentrated than income both on an individual and national basis. Roughly thirty percent of world wealth is found in each of North America, Europe, and the rich Asian-Pacific countries. These areas account for virtually all of the world’s top 1 per cent of wealth holders. On an official exchange rate basis India accounts for about a quarter of the adults in the bottom three global wealth deciles while China provides about a third of those in the fourth to eighth deciles. If current growth trends continue, …/
How is the economic status of the elderly changing and what are their prospects for the future? My portrait tells us how well off they are on average, but also about the vast disparities that exist among them. This description includes an often neglected measure of their economic well being— the amount of wealth they control. Amazingly little is known about how much personal wealth older people have and how and what determines its distribution. But the conventional definition of household wealth ignores two critical components of wealth: the expected income flows from pensions and SocialSecurity. For some elderly households, SocialSecurity represents the largest part of their wealth. I conclude with some thoughts on one of the most sensitive and critical public policy issues— the necessity of reforming SocialSecurity.
There is an criticism on Corporate social responsibility as well like it was said by the some authors that it work against the agency theory that tells us that the managers are working in the organizations as the agent and their basic goal is involving in the activities that maximizing the profits of the organizations rather than take in consideration of otherfactors like work for the betterment of employees, customers, stakeholders and the environment. This criticism can be neglected in a way that if you work for the employees than they are more engaged to the organizations and effectively doing their tasks that adds value in the organizational overall performance. According to Rangan (2012) most of the firms in today’s era are implementing some practices of CSR in their operations regardless of the ongoing criticism on CSR.
Because most workers near the middle of the income distribution can expect to have relatively little income in retirement other than their SocialSecurity, these reductions in benefits imply substantial reductions in income. The 9.6 percent cut in benefits for a worker in the middle quintile in the 40-44 age cohort translates into a 6.4 percent reduction in income. This is equivalent to a 6.4 percentage- point increase in the tax rate for these households. The 6.2 percent reduction in benefits for a worker in the middle quintile in the 45-49 age cohort would translate into a 3.7 percent reduction in income. This is equivalent to a 3.7 percentage-point increase in the tax rate for these households. 5 Figure 1A shows the percentage decline in Social Security’s Old-Age and Survivors Insurance (OASI) benefits and retirement income by quintile for the cohort that was between the ages of 40- 44 in 2007. Figure 1B shows the same information for the cohort that was between the ages of 45- 49, and Figure 1C shows this information for the cohort between the ages of 50-54. The cohort between the ages of 55-59 is excluded since the proposed schedule of cuts would not affect their benefits.
If these empirical observations are indeed correct, the interpretation given in the mentioned microeconomic literature is more problematic. These authors allow only a minor role for capital and credit market imperfections (entry barriers, transaction or holding costs, increasing returns to the size of investment, etc.), or again for distortions associated with socialsecurity, which may discourage small amounts of saving (Hubbard et al. 1995). Similarly, they disregard the implications of buffer-stock models, which explain low levels of wealth - for prudent consumers - by "impatience" (i.e. high time preference), together with liquidity or borrowing constraints (Deaton, 1992), or with private or public insurance imperfections (Caroll, 2001). And the fact of concentrating on wealth disparities at a given age
so that, again, changes in habits only aect the level of intragenerational mobility through the transmission of tastes across the generations within the same family. We see thus that the introduction of aspirations and habits have opposite eects on intergenerational mobility. On the one hand, the introduction of aspirations raises the degree of mobility. As the marginal utility of adult consumption increases when aspirations are introduced ceteris paribus, workers tend to increase their consumption by both reducing their saving and, thus, by reducing the amount of bequests they plan to leave to their children. Obviously, this results in a smaller correlation between the assets of the members of the same family belonging to two consecutive generations. On the other hand, when habits are introduced, workers wish to smooth more their consumption along the life cycle. Hence, a positive shock in their labor income results in a larger increase in their saving aimed at shifting adult consumption towards old consumption. In the presence of aspirations, consumption and saving levels of individuals belonging to consecutive generations become correlated and this correlation becomes indeed larger as the saving of each individual becomes more sensitive to productivity shocks. We see then that the introduction of habits results in an increase in the correlation of wealth between members of consecutive generations within the same dynasty.
The introduction and growth of public pension programs radically influences the process of saving and wealth accumulation. In Italy, as in the majority of developed countries, future socialsecurity benefits represent a substantial part of total household wealth. Since Feldstein’s study (1974), which introduced the concept of socialsecuritywealth for the first time, this variable has been empirically estimated using both aggregate and survey data. In particular the degree of substitutability between socialsecuritywealth and private wealth has been tested in a large number of analyses designed to verify the validity of the life-cycle hypothesis (for Italy studies, see Rossi and Visco 1990, Jappelli 1995, Attanasio and Brugiavini 2003). Socialsecuritywealth measures and estimates have also been widely employed in political and economic debate in order to gauge the sustainability of the public pension system, the long-term effects of pay-as-you-go systems on public finance (Brugiavini and Peracchi 2004, Sartor 1999), and the effects of pension rules on labour supply decisions (Brugiavini and Peracchi 2003).
In 1932, the first computer Z1computer was invented by KonradZuse which was electro mechanical computer, bulkier in size, and used difficult programming languages and it is mainly used for scientific calculations, census, accounting, and payroll and inventory problems . After this period there was a huge development in the field of computing. In 1942 first electronic digital computer was invented with the computing functions and parallel processing was also included in this version. In 1946 ENIAC I was developed mainly for American military research. Up to 1948 computers used vacuum tubes but after 1948 transistors were introduced and by the end of 1960 integrated circuits were invented. At this point of time information becomes much more secured than physical mode of security. This period raised a challenging question: “How one can send information from one place to another?” This leads to the thinking of networking and the year 1960 is known to be the breakeven point since this period introduced the concepts of computer networking.
In the technical literature, there is another formulation which uses the nodal admittance matrix to transform the linear (DC) network balance constraints. This transformation obtains one power balance equation which is also used in the economic dispatch to meet the demand of the customers. Replacing the nodal matrix into the transmission power flow definition, the inequality constraints accomplished are a function of the PTDF and the net power injected in the electrical buses. For solving the OPF problem, the decision variables are only the active power generation of each unit [ 15 , 16 ]. With this formulation, there is a very important reduction in decision variables as well as equality and inequality constraints in comparison with the classical DC-based formulation. In [ 15 ], the authors apply an interior-point algorithm to figure out the PTDF-based formulation. The algorithm was developed using DIgSILENT Programming Language (DPL); however, the optimization problem does not include the security-constrained analysis.
indicators ignore certain crucial determinants of families' welfare. Indeed, given the growing importance of short-term income uncertainty, current income may not be an appropriate measure to evaluate the distribution of welfare due to its low capacity to reflect expected lifetime resources (Gottschalk and Moffitt 1994, Blundell and Preston 1998). Further, changes on income inequality may have different effects on welfare distribution depending on the credit constraints and the insurance mechanisms available to households. Thus, the effect of income shocks on consumption and welfare inequality will depend to a large extent on the families’ capacity to smooth consumption during low income periods. In this respect, household wealth contributes importantly to household well-being as assets are the main instrument households have to insure themselves against risk. 1 In fact, wealth is the principal source of liquidity for
In this paper we study the distribution of wealth in Spain using data from the …rst wave of the Spanish Survey of Household Finances (Encuesta Financiera de las Familias, EFF), conducted by the Bank of Spain in 2002. This is the …rst survey that provides detailed information on the wealth holdings of Spanish households. 2 Research on the distribution of wealth in Spain is scarce and, given the lack of survey data until 2003, mostly based on wealth tax data. Thus, Naredo (1993) and Arcarons and Calonge (2003) use information from the Spanish wealth tax (Impuesto sobre el Patrimonio) to analyse the distribution of the wealth tax base and tax burden and conclude that both these variables are highly concentrated. More recently, Alvaredo and Saez (2006) estimate top net worth, …nancial wealth and gross income shares for the period 1933-2002 also using personal income and wealth tax information. These authors …nd that the sharp increase in real estate prices in Spain has been, to a large extent, o¤set by large stock price increases, leaving overall wealth concentration relatively stable between 1982 and 2002. Using a di¤erent approach, Perdiz (2004) uses data from the Spanish Household Expenditure Survey (Encuesta de Presupuestos Familiares, EPF) to estimate household wealth using reported income ‡ows
With the unified socialsecurity system, this paper analyzes inter-generational distribution regarding con- sumption and welfare in general equilibrium. This paper specifically compares the saving, consumption, and capital accumulation under the three different socialsecurity systems, PAYG, Fully Funded, and Partially Funded and examines the effects of alternative system on these variables. One contribution of this paper is to derive closed form solutions for these variables so that direct comparison among different systems is made possible. The solution is based on the maximization problem of two-period intertemporal choice model in an environment of OLG production economy populated by young generations who work, consume and save and the old who consume out of their personal savings and/or public pensions. It is well known that a socialsecurity system gives the old generation opportunities to smooth out consumption stream over time. However there is crowding-out effect between private saving and public saving and the effect largely depends on the size of fun- dedness. When the interest rate increases, given fundedness intensity, it increases public saving/transfer. But this in turn tends to decrease the incentive for private saving, while the private saving itself is subject to income and substitution effects in an inter-temporal choice when there is a change in interest rate. The result shows that in- crease in intensity of fundedness increases capital accumulation under the condition that the total saving would not decrease a lot from income effect which outweighs substitution effect and others with higher interest rate. Likewise the increase in intensity increases private saving but decreases consumption, when population growth rate is greater than the net return to capital. This paper also finds that, for a partially funded system, an increase in tax rate increases public saving but reduces private saving unambiguously, while the effects on consumption and capital accumulation are not conclusive.