Tuesday Morning Links

This and that for your Tuesday reading.

- Daria Ukhova summarizes the OECD's findings on the links between inequality, poverty and the economy:

Inequality, economic growth, and poverty. In the new report, the OECD has tried to establish the links between these three phenomena, which so far have been mostly explored in pairs, as the relationship between inequality and growth and the relationship between inequality and poverty. While confirming previous arguments about the negative impact of inequality on growth and on poverty, the OECD has gone a step further, arguing that the mechanism through which inequality actually undermines growth is through the channel of human capital. Specifically, they find that higher levels of inequality result in worse educational attainment, skills and employment among the poorest 40%, which then translates into lower levels of human capital and lower growth. The report, however, does not explore the underlying causes of this relation. Comparing the low and high income inequality countries in terms of degrees of their educational systems’ privatization or labour market flexibilisation could shed light on the questions re why poor people in more unequal countries ‘invest’ less in their human capital.

Horizontal and vertical economic inequality. By dedicating a whole chapter to looking at how the changes in women’s economic activity in recent decades have affected the dynamic of economic inequality among households, the OECD has done a great job of mainstreaming a debate that until recently was primarily heard only at feminist economics conferences. Looking at how other types of horizontal inequality (ethnic, racial, etc.) affect current trends of vertical economic inequality could become another important step in making mainstream economic debates less gender- and colour-blind.

Precarisation of work and inequality. Although the OECD prefers to refer to this phenomenon as a rise of non-standard work or NSW (under which they include temporary contracts, part-time employment and self-employment), by making an argument about NSW being a primary driver of the recent growth of inequality, the OECD seems to be actually moving away to some extent from its earlier position on the need to flexibilise labour markets. The issue that remains unaddressed by the report is why have the labour markets become so flexibilised in the first place? Addressing this question would probably require a degree of reflexivity by the OECD that the format of such report, unfortunately, does not allow.

- Andrew Heisz and Brian Murphy study the importance of taxes and transfers in reducing income inequality, while Trevor Hancock rightly reminds us that taxes should be considered the price we pay for civilization. And Thomas Piketty reviews Anthony Atkinson's new book on how to develop a more equitable society.

- But Christopher Ingraham points to the U.S. as a prime example of how the outsized influence of extreme wealth can lead the tax system to be outright regressive, with the super-rich seeing their tax rates go down as their income goes up.

- Finally, Human Rights Watch and Margaret Atwood each weigh in on the dangers of Bill C-51, while Lawrence Greenspon highlights the risk that the Cons' terror tactics will set up the next sorry chapter of human rights abuses in Canada's already-checkered history. And Susana Mas reports on the latest invasion of privacy from the Cons, as their new omnibus budget bill includes the mandatory collection of biometric information from visitors.