US income inequality and assortative marriages
Jeremy Greenwood, Nezih Guner, Georgi Kocharkov, Cezar Santos 22 February 2014
How Americans form and dissolve families has changed dramatically since 1950. One of these changes has been an increase in assortative mating, i.e. how likely a person is to marry someone of similar educational background. This column argues that since education is an important determinant of income, these patterns of matching have had an important impact on the economy's distribution of income.
Income inequality in the US has sharply increased over the last several decades. This is a well-documented fact (e.g. Gottschalk and Moffitt 1994, Katz and Autor 1999). The general public is also very interested in the issue. A recent USA TODAY/Pew Research Center poll shows that the majority of the population thinks “the economic system in the country unfairly favours the wealthy” and that the government should do “a lot to reduce the gap between the rich and everyone else.” Policymakers are aware of this as well.
Poverty and income inequality
marriage, assortative matching
Why buyers matter
Andrew B. Bernard, Andreas Moxnes, Karen-Helene Ulltveit-Moe 15 November 2013
Discussions of international trade often focus on aggregate trade flows, but it is firms that trade, not countries. This column presents evidence from Norwegian export data showing that larger exporters have more customers and greater dispersion in customer size. Moreover, exporters with many customers tend to sell to importers with few suppliers. These stylised facts are captured by a model in which finding a buyer is costly. The model’s prediction that export responses are amplified in destinations with less buyer dispersion is confirmed in the data.
Trade in goods across borders is conducted by firms, from an exporting firm in a source country to an importing firm in a destination country. Firms trade, not countries.
trade, Norway, heterogeneity, assortative matching