Structured around four research domains
This initiative is broadly structured around four research domains, which are meant to convey the scope of the program rather than mutually exclusive categories. The illustrative examples offered below by no means exhaust the sorts of questions that Scholars might investigate in their own work.
Core questions in each domain focus on causes, consequences, or policies to address issues of inequality. Policy questions are broadly conceived to encompass not only policy evaluation, but also investigations of the politics and political economy that give rise to particular policy institutions and outcomes.
A distinctive new component for the coming five years will be a coordinated endeavor to develop new research on top-end income inequality and wealth concentration, the main drivers of U.S. economic inequality in recent decades.
1. Top-end income inequality and wealth concentration
Top-end income inequality. Research in this domain seeks to understand the causes and consequences of growing income inequality driven by trends at the upper reaches of the distribution, particularly the gains of the top 1 percent.
Accounting for top-end income growth recognizes both labor market explanations and the growing role of capital income in the rise of top incomes in the U.S. since the late 1990s. To what extent do changes in technology, the supply and demand for education and skills, and globalization explain the rise of the 1 percent? What is the role of CEO pay and executive compensation? How much top-end inequality is driven by pay dispersion within versus across firms? How do other countries compare, and what explains cross-national differences?
The magnitude of the rise in top-end inequality invites empirical examination of its systemic consequences—its economic, political, and social effects for those at other strata in the distribution. What is the effect of top-end inequality on economic growth? What are the mechanisms by which it motivates or impedes innovation? Does top-end inequality induce “consumption cascades,” consumption choices that ripple down the distribution? Do these consumption choices in turn increase the odds of financial distress (Bertrand & Morse, Frank)?
What are the effects of a pulling away of top incomes on social stratification and affinity? How does it affect willingness to invest in public goods? How does growing income inequality at the top affect the distribution of political preferences and political participation? Does economic inequality at the top drive political polarization and government gridlock?
Wealth concentration. Income and wealth inequality are closely linked, but wealth will also reflect differences in savings rates, rates of return, and inherited wealth. What are the sources and consequences of even greater levels of concentration at the top of the wealth distribution? How did the Great Recession affect the wealth distribution? How rigid is the wealth structure, and to what extent is wealth inequality maintained across generations? What is relative importance of different channels of intergenerational wealth transmission (Pfeffer and Killewald 2015)? What are the consequences of soaring levels of wealth inequality at the top for intergenerational mobility?
The political implications of growing wealth concentration for democracy has drawn attention in public discourse, but empirical research on these issues has only begun to scratch the surface. Research by Theda Skocpol and colleagues has highlighted the importance not simply of vast inflows of money into politics in recent years, but its organization and strategic deployment through wealthy donor networks. How have these developments affected the political parties, their strategies, and policy outcomes?
Stepping back, what are the political economy dynamics that have contributed to the rise of top-end income and wealth inequality? What are the political and economic interests that have shaped the institutions and regulatory frameworks governing financial markets, intellectual property rights, housing markets, antitrust and labor law, or bankruptcy law?
What tax and regulatory policies can address top-end inequality and wealth concentration? How does the mobility of capital shape optimal tax policy? What are the politics and political economy of tax policy? What policies can help increase middle class savings and asset-building across the distribution?
2. Poverty and justice
Poverty. Research here aims deepen our understanding of the nature of poverty and economic insecurity for individuals and families. What are the causes of persistent poverty? What are the main sources of economic insecurity, and what effects do economic shocks have long-term socioeconomic mobility?
What are effective social policies to alleviate material hardship and foster durable mobility out of poverty? What can be done to tackle joblessness and boost earnings among the lowest-paid workers? What has been the impact of the Earned Income Tax Credit, education and workforce training, housing policies, moving to opportunity programs, and pay for performance (social impact bonds) as models for tackling problems of economic insecurity and opportunity?
What explains the distinctive U.S. welfare state? How do differences in interest group organization, electoral institutions, and economic and social institutions explain the cross-national variation that we see?
Criminal justice. After forty years of growth in the scale of criminal punishment, the United States has built a massive penal system unparalleled in the world, incarcerating whole segments of America’s poor and minority communities. (Western 2015). What is the effect of the criminal justice system on the families of the incarcerated, victims of crime and violence, and communities now saturated with criminal justice supervision?
What are promising policies to meet the challenges of reentry and employment opportunities for formerly incarcerated? What are the political forces that contributed to sharp rise in mass incarceration, and what are the politics underlying prospects for criminal justice reform today?
3. Inequalities and opportunity
Inequalities. Research in this domain explores inequalities as they manifest themselves in various domains. Cross-national comparisons can help disentangle potential explanations and bring into sharper relief the political underpinnings of different national responses to inequality, including labor market and family policies.
Labor markets. How have skill-biased technological changes, changing demographics, globalization, and declining unionization, and government policies such as the minimum wage affected wage dispersion? What explains the gender wage gap? How can firms foster diversity?
Gender and family. To what extent do changing gender norms affect women’s participation in household and labor market activities? How does changing family structure shape patterns of poverty and the intergenerational transmission of disadvantage? And in turn, how have changes in economic opportunity and insecurity affected family formation and stability?
Educational inequalities. Access and quality. Most explanations of rising inequality focus attention on formal education at all levels as the most powerful mobility device. How might disparities in access and school quality and achievement gaps be narrowed?
Environmental inequalities. Those living in poor communities are particularly likely to be exposed to environmental toxins. What are the economic, political, and social sources of these disparities, and what are the long-term developmental and societal consequences? Examining the economics and politics of environmental issues can deepen our understanding of the unequal incidence of environmental harms, just as they can inform the development, implementation, and enforcement of effective environmental regulation.
Political inequalities. What are the sources of political inequalities in engagement, participation, and representation? How are economic and social inequalities related to issues of civic trust, democratic governance, and accountability?
Opportunity and intergenerational mobility. To what extent do the circumstances in which a child is born determine life outcomes? Measuring socioeconomic mobility over the life course and intergenerational mobility is a central area of inquiry. Are income or wealth inequality causally related to socioeconomic mobility, or are they best viewed as distinct phenomena? How has intergenerational mobility changed over time? What are the mechanisms of intergenerational transmission of advantage, and how might these differ at different points in the income distribution?
Research has shown that gaps contributing to later educational achievement emerge quite early in childhood, with enduring consequences for later life chances. How can we narrow opportunity gaps for low-income children?
4. Cross-cutting dimensions: Racial and spatial inequalities
Research here seeks to understand cross-cutting dimensions of inequality, disparities not simply reducible to income inequality. Racial and spatial inequalities suggest further empirical investigation of the ways race and place continue to shape the lives and life chances of individuals.
Race. The nature of poverty, labor force participation, socioeconomic mobility, health, and wealth all exhibit enduring differences by race. Research has shown that black families live in poorer neighborhoods than white families at similar incomes (Reardon, Fox, and Townsend 2015). Seventy percent of African-Americans who live in today’s poorest, most racially-segregated neighborhoods are from families who lived in similar neighborhoods three decades ago (Sharkey 2013). Evidence suggests that black children raised in middle-income families fall out of the middle class at higher rates than white children in adulthood (Brown 2016).
Black joblessness remains higher than that of whites, with no appreciable narrowing of this gap over more than four decades. Black unemployment remains higher at all education levels. African-Americans exhibit premature aging on a variety of health measures and shorter life expectancies than whites, health disparities that are present at all income and education levels (Williamson 2016). Racial wealth gaps are large and growing: Average family wealth for whites in 2013 was $678,000, compared to $95,000 for black families.
What are the social and institutional structures that contribute to persistent disparities in outcomes by race? What role do implicit biases and discrimination play? How can social policy work to reduce racial disparities in access to opportunity and in the distribution of valuable resources? How does the politics of race influence social policy?
Spatial inequalities. A growing body of research in sociology and economics suggests that one’s neighborhood shapes various individual outcomes and upward mobility later in life. Research in political geography highlights the ways in which spatial features shape political processes and policy outcomes.
What are the mechanisms of neighborhood environment that shape opportunity and life outcomes? What are the implications for policy aimed at improving opportunity for those living in distressed neighborhoods? What is the role for moving-to-opportunity programs, investments in schools, or investment in neighborhoods?
In the context of growing income and wealth concentration, how does the geography of inequality and economic segregation affect social interactions and individual outcomes? What are the consequences of growing economic segregation for the supply and distribution of local public goods? How does political geography influence the mobilization and representation of political interests? How does it shape capacities to address local social problems? How do the politics of land-use, local development, and mass transit reinforce or mitigate problems of poverty and inequality at the metro level?
Evidence of declining geographic mobility and labor market fluidity in the US over the past three decades has been identified as a potential contributor to income inequality (Ganong and Shoag 2015, Molloy et al 2016). What are the sources of changes in geographic mobility and labor market fluidity? What role do housing markets and land-use regulation play?