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One way inflation affects consumption inequality is through its varying impact on the purchasing power of different households. Indirect taxes, which affect commodity price levels, are another effective factor influencing consumption inequality. Turkey is a highly unequal country with a long history of high inflation. Moreover, indirect taxes have been used frequently as a policy tool in the last decades. This study develops a novel approach to examining the relative contributions of household inflation rates and indirect tax changes to real consumption inequality and applies it to the case of Turkey. The analysis is carried out using both household‐level data and artificial panel data created to apply the Shapley and Owen decomposition methods. The findings roughly can be summarized in two points. First, while nominal consumption during the 2003–2019 period became more equal, real consumption inequality increased as a result of price changes during that time. Variations in household inflation rates are the primary source of increased inequality. Second, changes in indirect taxes account for 31% to 68% of the unequalizing effect of price changes, depending on the method used. Results imply that monetary and indirect tax policy mix have been in favor of the rich in this period. [ABSTRACT FROM AUTHOR]

Consumption inequality may impede economic development and hinder the achievement of common prosperity. Using three waves of the China Family Panel Studies from 2014 to 2018, this paper investigated the impact of e‐commerce on consumption inequality, as measured by the Kakwani index. The results indicate that e‐commerce can reduce household consumption inequality. A mechanism analysis shows that e‐commerce can narrow household income inequality, increase the purchasing power of low‐income households, and promote the consumption of households with limited access to offline markets, thereby reducing the consumption gap. A heterogeneity analysis suggests that the positive role of e‐commerce in reducing consumption inequality can be more significant among vulnerable households, such as households with elderly members and less‐educated households. E‐commerce can have varying impacts on consumption inequality across different subcategories of household expenditure, with the greatest impact seen in entertainment and education expenditure. These findings provide new evidence for the role of e‐commerce in reducing consumption inequality in the digital economy, and the implications of this are discussed. [ABSTRACT FROM AUTHOR]

This paper reexamines the cyclical behaviors of price markup, profits, and labor share when responding to monetary and fiscal policy shocks in a two‐agent, two‐branch, and two‐sector model. We show that this framework is able to generate procyclical price markup and profits, and countercyclical labor share conditional on expansionary policy shocks. These results are in line with empirical evidences but at odds with the prediction of canonical New Keynesian models. As the share of nondurables in total production decreases, the results reverse. This finding implies expansionary monetary and fiscal policies widen the income inequality between Ricardian households and collateral‐constrained households. [ABSTRACT FROM AUTHOR]

This paper develops a simple theoretical model and offers empirical evidence of urban segregation on consumption inequality between rural‐to‐urban migrants and urban residents. Our analyses are based on the 2007 China Household Income Project (CHIP) and the 2017 China Migrants Dynamics Survey (CMDS) data. Results obtained from propensity score matching and 2SLS methods show that urban segregation caused by the hukou system leads to significant consumption inequality between rural‐to‐urban migrants and urban residents. Hukou conversion matters for improving migrants' consumption, but when or how hukou was transferred makes little difference. Besides, we find that the disparity in consumption between rural‐to‐urban migrants and urban residents is more prominent in the higher‐income group or in cities with stricter restrictions on hukou conversion. Finally, our results are robust to a series of sensitivity checks. [ABSTRACT FROM AUTHOR]

Does disparity in income and consumption incite terrorism in Africa? To answer this important question, we investigate the empirical linkages between inequality and terrorism by separately regressing income and consumption inequalities on four indicators of terrorism: domestic, transnational, unclear, and total over the period 1980–2012. Employing a negative binomial regression across a panel dataset covering 46 African economies, the following findings are established. First, both income and consumption inequalities have decreasing impacts on all terrorism measures—with the exception of uncertain terrorism (the impact of which is negligible). Second, both income and consumption inequalities exert more statistical influence on transnational terrorism than domestic terrorism. Third, income inequality exerts more statistical weight on terrorism measures than consumption inequality across the model specifications. Last, the non-trivial impact of confounding variables—such as the lagged value of terrorism, surface areas, and conflicts—are validated across the terrorism models. In line with these empirical outcomes, policy implications and suggestions for further studies are offered. [ABSTRACT FROM AUTHOR]

Growing research shows that information technology accelerates economic growth and development, but the effect of Internet penetration on inequality is less well documented, especially about consumption inequality. On the one hand, Internet lowers transaction costs and offers equal access to online products especially beneficial for remote and poor populations, seemingly reducing inequality. On the other hand, uneven access to the Internet may increase divergences. This study examines the relationship between Internet penetration and consumption inequality. Using data from 155 counties available from 2010 to 2016 China Family Panel Studies, this study examines whether Internet penetration potentially impacts consumption inequality considering regional heterogeneity. Based on fixed‐effect models and the two‐stage least squares regressions, results suggest the Internet penetration may increase consumption inequality measured by the Gini index. Furthermore, higher education and over a certain Internet penetration rate buffer the positive impact of the Internet. In some cases, the Internet has smaller positive or even negative impacts on consumption inequality in regions with higher education levels and over threshold penetrations. [ABSTRACT FROM AUTHOR]

In this paper, we look at the evolution of consumption and wage inequality from 1980 to 2016 in the US. We use data from the Consumer Expenditure Survey (CEX) and the Current Population Survey (CPS) to look at differences in consumption and wages across groups in the population defined by educational attainment of the household head and year‐of‐birth cohort. We show that the results obtained by Attanasio and Davis (1996) for non‐durable consumption still hold in more recent decades. In addition to non‐durable consumption and services, we look at inequality measured in terms of expenditure on and stock of vehicles. The advantages of looking at these measures are that information on cars is typically measured more accurately than other components of expenditure and consumers are more likely to react by adjusting their stock of vehicles on the basis of long‐term expectations about their economic prospects. [ABSTRACT FROM AUTHOR]

This paper studies the pro‐poor bias of trade policy in India by estimating the household welfare effects of removing the current protection structure. The elimination of a pro‐poor trade policy is expected to have a negative differential welfare effect at the low end of the distribution. The paper first constructs trade restrictiveness indexes for household consumption items and industries using both tariffs and non‐tariff barriers. The results indicate that Indian trade policy is regressive through the expenditure channel as it disproportionately raises the cost of consumption for poorer households, while it is progressive through the earnings channel. Based on the net welfare effects, the elimination of the current trade protection structure is estimated to reduce inequality. These results indicate that a trade policy that is progressive through the earnings channel may induce a price effect that is regressive through the expenditure channel. [ABSTRACT FROM AUTHOR]

Abstract: Population ageing has significant economic and social costs, and this paper studies its impacts on inequality, both theoretically and empirically. First, we build a two‐period overlapping generation model with uncertain lifetime and find that population ageing has the overall effect of increasing income and consumption inequality within the society. For empirical analysis, we use household data from China Health and Nutrition Survey to assess the age effect on income and consumption inequality in China, and confirm the results predicted by the theoretical model. [ABSTRACT FROM AUTHOR]

Using four rounds (1999, 2002, 2005 and 2008) of the Korean Labor and Income Panel Study, the present paper examines determinants of household income and consumption levels and inequalities. Unconditional as well as conditional stochastic dominance tests are performed by year, by household heads' characteristics (age, education, gender, health, marital status and occupation) and by household characteristics (household type, household size and degree of urbanization). Mean least squares regression techniques are used to predict conditional expectations. The residuals containing effects for each characteristic conditional on the remaining characteristics are then used for the stochastic dominance analysis employing extended Kolmogorov- Smirnov tests of first-order and second-order dominance in distribution of income and consumption. The results provide a detailed and up-to-date picture of inequality and poverty by subgroup in Korea, which helps in targeting particularly vulnerable groups. While inequality in disposable income is found to be substantial, consumption inequality is less substantial. Households headed by the elderly, the uneducated, the divorced, the widowed, females, and those with health problems are found to be the most vulnerable groups. [ABSTRACT FROM AUTHOR]

The article studies the dynamics of chronic poverty in rural India. The article attempts to analyse the factors influencing the incidence and mobility of poverty and the changes in the influence of these factors over time. This article uses the household panel survey data collected by NCAER. It examines whether there has been change in the influence of factors such as village level infrastructure, household size and composition, and economic growth on poverty dynamics in different periods of time. The impact of a number of factors changes over time implying that the strategies for poverty reduction would have to take into account the changing economic environment. The article further presents an analysis of growth rate of per capita expenditure for the same set households to analyse the extent of consumption growth, which is also an indicator of poverty reduction for rural India. Copyright © 2011 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Consumption has been recognized as a more reliable indicator of household well-being than income. Although a considerable body of literature has examined income inequality between farm and nonfarm households, little is known about inequality in consumption. This research aims to fill this knowledge gap by investigating consumption disparity between farm and nonfarm households. Using a nationally representative household survey from Taiwan, we apply an unconditional quantile regression-based decomposition method to decompose the differences in the distribution of household expenditure between these farm and nonfarm households. The results indicate that differences in the observed characteristics between these two types of households explain most of the consumption inequality. Moreover, the difference in the education level of the farm operator, household income, and the degree of urbanization are particularly important. [ABSTRACT FROM AUTHOR]