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The article discusses developments in the U.S. economy as of April 2014, particularly on the issue of income inequality. It tackles such topics as income distribution, the reason why inequality matters to social welfare, and annual household-level income. It features the works of Betsey Stevenson, Justin Wolfers, and economist John Roemer.

The article examines whether the socially optimal top marginal income tax rate in the U.S. is around 73 percent, with a range from 54 to 80 percent. Topics discussed include the claim made by researchers that the tax rate underestimates the distortive impact of a higher tax rate on real economic choices and the causes and effects of government policy on macroeconomic activity as proposed by economists Thomas Sargent and Christopher Sims.

Using data from two detailed, nationally representative, household datasets - the National Family Health Survey and the India Human Development survey - we explore whether women who are economically empowered (through work, earnings, or wealth) are less likely to experience domestic violence. We find that, while working women may be at a greater risk of violence, higher earnings are associated with a reduction in violence. Although these findings are informative, they do not necessarily establish a causal link between economic empowerment and violence. To test for causality, we exploit arguably exogenous variation in state laws designed to equalize the inheritance rights of sons and daughters. Additional variation comes from the fact that these state laws did not apply to some women based on their religious affiliation and date of marriage. We find some evidence that women who were subject to these laws are less likely to report being victims of domestic violence. [ABSTRACT FROM AUTHOR]

The article discusses the advantages and disadvantages of switching to a tax system in the U.S. which is based on individual, instead of family, income. It states that family-based tax systems create many difficulties which reduce prosperity and create inequality across households and individuals. It mentions that an individual-based tax system creates differences across families with similar incomes based on how income is distributed between the spouses.

Entitlement spending is projected to put a great deal of strain on the federal budget in coming years. A key factor underlying the growth of entitlement spending is the deteriorating ratio of workers to retirees. This problem is exacerbated by various policies that create disincentives for work at older ages. One way to reduce the fiscal burden of entitlement programs is to encourage longer working lives by minimizing these disincentives. This paper documents the recent trends in employment among older workers, summarizes the evidence on how policies influence retirement decisions, and describes several reforms that have the potential to increase employment among older workers. [ABSTRACT FROM AUTHOR]