Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/195434 
Year of Publication: 
2017
Citation: 
[Journal:] Econometrics [ISSN:] 2225-1146 [Volume:] 5 [Issue:] 4 [Publisher:] MDPI [Place:] Basel [Year:] 2017 [Pages:] 1-19
Publisher: 
MDPI, Basel
Abstract: 
On the presumption that poorer people tend to work less, it is often claimed that standard measures of inequality and poverty are overestimates. The paper points to a number of reasons to question this claim. It is shown that, while the labor supplies of American adults have a positive income gradient, the heterogeneity in labor supplies generates considerable horizontal inequality. Using equivalent incomes to adjust for effort can reveal either higher or lower inequality depending on the measurement assumptions. With only a modest allowance for leisure as a basic need, the effort-adjusted poverty rate in terms of equivalent incomes rises.
Subjects: 
equivalent income
welfare
inequality
poverty
labor supply
JEL: 
D31
D63
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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