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This paper provides a short history of family allowances and documents that Keynes supported family allowances as early as the 1920s and continuing through the 1930s and early 1940s. Keynes saw this policy as a way to help households raise their children and also as a way to increase consumption without reducing business investment. The paper goes on to argue that a policy of family allowances is consistent with Keynesian economics. Finally, the paper uses the Luxembourg Income Study to estimate the impact of family allowances on child poverty in several developed nations and estimates the poverty-reducing impact of several possible family allowance programs for the US.

This study uses the Luxembourg Income Study to examine the size of the middle class across several less developed American nations. One main finding is that in the mid 2000s the size of the middle class in Latin America does not seem to depend on demographic factors. A second finding is that, in contrast to most developed nations, government tax and spending policies do little to increase the size of the middle class in less developed America. Finally, as in the developed world, labor market factors do not have much impact the size of the middle class in Latin America. The main exceptions here seem to be Brazil and Mexico, where employment appears to increase the size of the middle class.

This paper updates and extends my earlier work, published in the Journal of Economic Issues, on how the middle class fares throughout the world. My 2007 paper provided a definition of the middle class as well as estimates of the size of the middle class in several nations. It argued that the fraction of households that are middle class across nations and over time is mainly determined by government tax and spending policies. The more progressive the national tax system, and the more generous government spending programs, the larger is the proportion of middle-class households. This empirical work on the middle class was done using the Luxembourg Income Study (LIS), an international database containing extensive income as well as socio-demographic information. LIS databases center around particular years, called 'waves'. Each wave is around 5 years apart, with Wave #1 beginning in the early 1980s. For my previous research, data was available only up Wave #5 (around 2000), and Wave #5 data was unavailable for some countries. More Wave #5 data is available, and some data for Wave #6, centered around 2004, has come online recently. This provides an opportunity to assess what has happened to inequality and the size of the middle class in the early 2000s. In addition, my earlier work focused only on aggregate tax and spending by governments; it did not look at specific policies and how these promoted a middle class in different nations. This paper focuses on three specific sorts of national spending policy that assist households and affect the size of the middle class across nations and over time. First, there are policies that aid the unemployed and disabled. Second, there are retirement programs that provide income to older households. Third, there are policies that assist families with children (child or family allowances, family leave policies and child support payments). It examines the extent to which each of these policies increased the size of the middle class in the early 2000s, the impact of the set of these three policies on the middle class in the early 2000s, as well as other possible determinants of the size of the middle class in the 2000s.

This paper updates and extends my earlier work (published in the June 2007 issue of the Journal of Economic Issues on how the middle class fares throughout the world. Wave #6 data from the Luxembourg Income Study, recently released and centered around 2004, provides an opportunity to assess what has happened to the size of the middle class around the world in the early 2000s. In contrast to the 1980s and 1990s, there was no noticeable decline in the middle class during the early 2000s. The paper provides further evidence that the size of the middle class in each nation depends mainly on government tax and spending policies. In particular, it shows the key role played by family allowances and paid family leave in supporting a national middle class.

Did the US middle class benefit from the 1990s economic boom? Did this halt or reverse a middle class decline from the previous decade or more? Is a shrinking middle class strictly a US phenomenon with domestic causes, or is a problem that has plagued most of the world economy? This paper will explore these issues. Section II describes previous attempts at defining the middle class. Section III then examines four possible causes of the declining middle class - changing demographic factors, structural economic changes, macroeconomic conditions, and a more Keynesian explanation which depends on the importance of government spending. Section IV describes the Luxembourg Income Study (LIS), which will be used to measure the middle class and to seek the cause of middle class decline in the US and other countries. Section V provides measurements of the middle class for a number of countries using the LIS. Because of the controversy surrounding definitional matters, several different definitions of 'the middle class' are employed. Using the LIS, section VI empirically examines the four different explanations for the shrinking middle class set forth in section III. Finally, we conclude with some policy implications.

This article employs the Luxembourg Income Study (LIS) to compare poverty rates for female-headed households (FHHs) with poverty rates for other households in a number of developed and transitional economies. It then seeks to explain why, in some countries, female-headed households are so much more likely to be poor compared to other families. The next two sections describe the LIS and discuss some of the problems encountered in measuring poverty. The paper then computes poverty rates in individual countries for female-headed households and for all other households using the LIS database. Given the problems associated with measuring poverty, we present several estimates of poverty for both types of household. Two sections then look at two theoretical explanations for the gender poverty gap-human capital theory and a Keynesian approach that emphasizes the importance of fiscal policy as an antipoverty tool. The last section summarizes the main findings and draws some policy conclusions.

This paper compares poverty rates for female-headed families and for other families in a number of developed countries. The author concludes that there are many different reasons female-headed families suffer relatively greater poverty in some countries but not in other countries. One implication of this analysis is that it is less important what gets done to help female-headed families, and more important that some policy be implemented to benefit female-headed families.