Month: December 2023

Urban political structures and the historical roots of wealth inequality

The evolution of wealth inequality is driven in part by past political structures. This column presents a case study from Germany, focusing on the history of the southern city-state, Nördlingen. The results of the study highlight how past political elites were able to exploit extreme moments of crisis, such as wars and epidemics, to enrich themselves, driving up wealth inequality. In fact, the extent to which a region had an oligarchic political structure transpires to be a clear driver of wealth inequality trends, today as in the past. 

The prices we pay: Why they matter and where they come from

The extent to which people shop around for the best price for products varies by income level. Households on relatively lower incomes tend to spend more time hunting for bargains and often choose budget options for products where possible. This column presents new evidence using consumer data from the United States, highlighting how prices differ across income groups. It shows how retailers’ response to households’ shopping behaviour reduces inequalities and provides policy-makers with useful lessons for supporting lower-income households.

Mapping honesty and migration: Lessons from Italy

Levels of dishonesty vary by region in Italy. This column measures how behaviours and attitudes relating to rule-breaking differ from place to place using childbirth registration data. By tracking where more people are falsifying birth records, it is possible to make accurate inferences about honesty in a given area. Importantly, the column also shows that migration movements can generate honesty drains or honesty gains in different areas. These changes correlate with regional economic outcomes, from human capital to productivity, to earnings growth, to the quality of local government.