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AN NBER PUBLICATION ISSUE: No. 5, May 2000

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
Social Security does not redistribute from people who are rich over their lifetime to those who are poor. In fact, it may even be slightly regressive. Many people think that Social Security is a progressive program which redistributes income from the rich to the poor. But according to new research by Julia Lynn Coronado, Don Fullerton, and Thomas Glass, Social Security does not redistribute from people who are rich over their lifetime to those who are poor. In fact,...

Research Summaries

Article
The authors find that collective-action clauses raise borrowing costs for less credit-worthy borrowers (by on average 150 basis points), while lowering them for more credit-worthy borrowers (by on average 50 basis points). In Would Collective Action Clauses Raise Borrowing Costs? (NBER Working Paper No. 7458), Barry Eichengreen and Ashoka Mody find that, contrary to the view of some policymakers and many market participants, collective-action clauses in fact reduce...
Article
Repeal leads to a decline of approximately 10 percentage points in the long-run union wage premium earned by construction workers ... but does not appear to lower the wages of black construction workers. Most states have "prevailing wage laws" which require private contractors bidding for state or local public works projects, or private projects that are financed in part by public funds, to pay a minimum package of wages and benefits to their workers. Although details...
Article
Growth in math and reading scores between the fourth and eighth grade is not related to spending differences across states. Analyses of income inequality invariably highlight the central role of education and "human capital," leading naturally to parallel policy concerns about differences in school quality. Despite controversy about the impact of spending on school quality, government policy and court actions continue to focus on altering resources for schools. In...

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