This paper takes issue with the proposition that low productivity growth in the non-market sector is dragging down Australia’s living standards. To do that, we revisit an old debate that showed that wages should be adjusted for productivity in the market sector alone. That was the argument put by John Nevile and used by the ACTU in the 1975 national wage argument that resulted in quarterly wage indexation. Discounting wages for the lower productivity in the non-market sector causes macroeconomic stress as it prevents wage-earners from purchasing as much of the market sector’s output.

In developing economies, where fiscal space is often constrained, the minimum wage is often seen as a potentially important tool for improving living standards and reducing inequality. Yet, rigorous evidence on its effects at the household level – where well-being is ultimately realised – remains scarce. This article provides the first region-wide analysis of the relationship between minimum wages and household income inequality in Latin America, distinguishing between market (pre-tax and public transfer) and disposable (post-tax and public transfer) income to assess whether the observed pattern is consistent with a predistributive interpretation. Using two-way fixed-effects models on a panel of 15 countries from 2003 to 2020, and triangulating results across SWIID, SEDLAC, and LIS, I find that a higher minimum wage is robustly associated with lower household inequality. The association is strongest when the wage floor is measured relative to average pay, and it appears for both market and disposable income. This parallel compression is consistent with a predistributive interpretation, and the findings are robust to controls for partisanship, alternative specifications, and small-cluster inference. Overall, the results suggest that minimum-wage policy can plausibly form part of a broader inequality-reducing policy mix in contexts of high informality and limited fiscal capacity.

The macroeconomic literature assumes that sectoral labor income shares and output per person are uncorrelated across countries. This paper shows that the data reject this assumption for a large set of countries. The labor shares of the manufacturing and market services sectors systematically increase with output per person relative to those of other sectors, leading to a shift of labor income across sectors with economic development. The empirical evidence suggests that capital deepening and cross-sector differences in the degree of capital-labor substitutability may be important for understanding these patterns. Researchers can directly use the provided dataset of labor shares to calibrate macroeconomic models.

The pandemic crisis introduced an unprecedented supply-side shock that was global in scope. Despite historically high levels of prior sovereign debt and low bond yields, macroeconomic policy responses included monetised fiscal expansions of extraordinary magnitude. Conventional theory suggests that the combination of supply contractions with such expansions is inflationary, yet central bank discourse during the pandemic expressed little concern about inflation. Our theoretical analysis suggests the presence of strong inflation forces at the time, likely offset by continuing pessimism shocks, consumption constraints and expectations management. In prominent advanced countries over more than a century, monetised fiscal expansions are shown to have preceded inflation surges, most strongly following signature episodes like WWII.

We augment an overlapping generations endogenous credit cycle model with environmental externalities and two regulatory authorities to study how fiscal and financial environmental regulation together shape environmental quality, macroeconomic stability, and income distribution. Environmental quality depends on pollution from the brown sector, regulated either through environmental haircuts on collateral or via tax-financed abatement and environmental improvements. We find that haircuts and taxes affect emissions, income distribution, and system stability in distinct ways, with interaction effects that create trade-offs between environmental outcomes and macroeconomic stability. Compared to scenarios with only financial regulation, introducing an environmental tax maintains similar environmental quality but achieves higher aggregate income and capital per worker. However, we uncover intergenerational trade-offs as environmental regulation improves environmental quality and raises incomes for younger agents and investors but lowers and destabilizes the returns of older generations reliant on capital income.

This paper examines trends in wage, income, and consumption inequality in Turkey from 2002 to 2023, a period marked by unorthodox economic policymaking before and after the COVID-19 pandemic. Using microdata from the Turkish Statistical Institute’s Household Budget Survey and the Survey of Income and Living Conditions, we document several salient distributional patterns. Wage inequality declined steadily over two decades, including during the recent episode of policy experimentation – coinciding with sustained minimum wage hikes and a rising share of university-educated workers. Income inequality also fell, though less markedly, before reversing in recent years due to widening disparities in capital and entrepreneurial income. In addition, consumption inequality rose dramatically during the unorthodox policy period, exceeding income inequality growth and driven primarily by a surge in durable goods consumption among top-decile households. These findings reveal the complex and multi-dimensional distributional consequences of unconventional economic policy in emerging markets and highlight the importance of examining inequality across multiple dimensions when evaluating policy effectiveness.

Preferences over social ranks have emerged as potential drivers of weaker than expected support for redistributive interventions among those closest to the bottom of the income distribution. We compare preferences for alterations of the income distribution affecting the decision maker’s social rank, but not their income, and compare them with similar alterations leaving both rank and income unchanged. Our study fails to find evidence of last-place aversion in a replication of Kuziemko et al. (Q J Econ 129(1):105–149, 2014). However, using a modified design that holds ranks fixed across rounds we find support for both a discontinuously greater disutility from occupying the last as opposed to higher ranks, thus affecting only those closest to the bottom of the distribution, and for a general dislike of rank reversals affecting most ranks. We discuss implications for policy design in both public finance and management science.

In spite of the upturn in the economy and in employment that has been observed in the EU since 2013 to 2019 (and after COVID-19 crisis), the gap between the figures for indicators of economic growth and those for the trends in domestic living conditions continues to be very wide; growth and newly created jobs are not resulting in a generalised improvement in the welfare of the population. This paper seeks to demonstrate that the recovery period after the Great Recession has not been one of truly inclusive recovery and to provide tentative explanations for this. We focus on the five main EU countries before Brexit. We conclude that the incidence of poverty associated with part-time work is now somewhat greater (‘in-work poverty’) and also that there has been strong containment of wages in the leading countries of the EU over the period under study, and even falls in real wages. At least, redistribution policies have shown themselves to be effective in reducing poverty.

This paper, building on new archival research and the social table method, presents comprehensive estimates of income inequality in Mexico in 1895, 1910, 1930 and 1940. Inequality grew from 1895 to 1910, driven by economic expansion within the context of an oligarchic economy. While real income increased for the lower classes during this period, the main beneficiaries were large landowners and entrepreneurs. In the revolutionary period from 1910 to 1930 inequality decreased especially as a result of land reforms, benefitting peasants at the expense of the large landowners. However, the economic structure of the country was not fundamentally changed, and in the 1930s inequality raised as incomes of peasants and those in the informal sector fell behind manufacturing and other high-earning sectors. The Mexican case shows the complex interaction of economics, demography and politics in determining economic inequality.