Trends in Transfers, Income, and Wealth
(Poverty and Income Policy)
Saturday, November 5, 2016: 3:30 PM-5:00 PM
Northwest (Washington Hilton)
*Names in bold indicate Presenter
Panel Organizers: Gwyn C Pauley, University of Southern California
Panel Chairs: Richard Burkhauser, Cornell University; University of Melbourne; University of Texas
Discussants: Jeff Larrimore, Federal Reserve Board and Sean Lyons, Congressional Budget Office
This panel is comprised of three papers that study government transfers, income growth, and wealth growth. In particular, this panel ties together papers that are focused on how public health insurance affects the transfer and income distributions in the United States and how the Great Recession affected each of these outcomes.
The first paper studies how including Medicare and Medicaid in the value of in-kind transfers affects after-tax income for families in the United States. The authors show the distribution of after-tax income for households going back from 2013 to 1959, just before major expansions of government tax and transfers programs associated with the New Frontier and Great Society programs of the 1960s were implemented. To do this, the authors use both CPS and decennial Census data. The paper shows that Medicare and Medicaid are important government programs and that excluding them from the calculation of income significantly understates the success of government policies in offsetting the decline in market income in lower income populations.
The second paper makes two contributions to the literature. First, the authors include Medicaid in the calculation of government transfers. Previous work has shown that for over 20 years prior to the Great Recession, aggregate real benefits increased, but there was a downward trend in benefits for non-elderly and non-disabled families and for the poorest families. Because Medicaid is targeted at families with low incomes, including it when calculating transfers could change these trends. The authors use the Medical Expenditure Panel Survey, which allows them to observe how much families actually received in-kind from Medicaid. Second, this paper determines whether the halt to the long-term redistribution that occurred during the Great Recession has ended and whether the long-term trends in redistribution have reasserted themselves.
The third paper examines why families have not fully recovered from wealth loss that occurred during the Great Recession. The author shows which families have and have not seen wealth return to pre-recession levels. The paper also shows how the housing market, labor market, and financial markets affected post-recession recovery and documents which factors were the most important in driving the uneven recovery across socioeconomic groups. Using the Survey of Consumer Finances, the author shows that homeownership is an important factor in explaining why African American and Hispanic families have recovered particularly slowly from the Great Recession. In addition, the author shows that homeownership explains a large percent in the wealth gap between higher educated families and lower educated families.