September 3, 1999

NOTE TO EDITORS

A special issue of the New York Fed’s Economic Policy Review, dedicated to the proceedings of a conference sponsored by the bank on Unequal Incomes, Unequal Outcomes? Economic Inequality and Measures of Well-Being has been released.

The May 1999 conference brought together some of the country’s leading researchers, academics, and policy analysts to examine whether the deterioration in income experienced by the poor in the last few decades has led to a similar deterioration in outcomes--in health, housing, and crime victimization trends.

Conference participants observed that there have been many improvements in the material well-being of the poor, but among the problems that remain are:

  • Health problems, which continue to affect low-income and minority groups disproportionately, despite advancements in health care.

  • Housing affordability among the poorest Americans.

  • Unacceptably high mortality rates of the inner-city poor even as crime victimization rates nationwide have fallen.

The conference participants also discussed the effectiveness of public policy responses to these outcomes, especially in the areas of education financing and local governance. Among their observations were:

  • School finance reform is not an effective policy instrument for substantially reducing income inequality.

  • Current funding for policies that promote income redistribution from the wealthy to the poor in large cities has been cut and limitations have been placed on future spending.

  • New legislation that limits liability for pre-existing environmental damage has made it easier for businesses to return to the central cities bringing with them jobs, urban renewal and new industries.

Contact: Douglas Tillett