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Do economic recessions ‘squeeze the middle-class’?

Batinti, Alberto and Costa-I-Font, Joan (2019) Do economic recessions ‘squeeze the middle-class’? Economics and Politics. ISSN 0954-1985

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Abstract

We examine whether economic downturns reshape the distribution of population income giving rise to a “middle-class squeeze.” We test this hypothesis using alternative definitions of middle-class, such as income-based measures from the Luxembourg Income Study (LIS), and perceived measures from the Integrated Values Study (IVS). Our findings suggest that, although recessions do not produce a middle-class squeeze overall, the unanticipated shocks resulting from the Great Recession did. Furthermore, we find that recessions increase the share of the population that regards itself as ‘middle-class.’ Estimates are heterogeneous to the baseline unemployment at the time of a recession, country spending on social protection, to middle-class measures and definitions.

Item Type: Article
Official URL: https://www.wiley.com/en-gb/Economics+&+Politics-p...
Additional Information: © 2019 John Wiley & Sons Ltd
Divisions: Health Policy
Subjects: H Social Sciences > HC Economic History and Conditions
Date Deposited: 03 Jun 2019 15:15
Last Modified: 13 Nov 2019 00:29
URI: http://eprints.lse.ac.uk/id/eprint/100930

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