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Ivan Kitov

 
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  • Economists Ignore 33,000,000 Americans When Calculating Income Inequality [View article]
    This is a list of income sources as defined by the Census Bureau
    http://1.usa.gov/Rgs0Zn :

    For each person in the sample 15 years old and over, the CPS asks questions on the amount of money income received in the preceding calendar year from each of the following sources:

    1.Earnings
    2.Unemployment compensation
    3.Workers’ compensation
    4.Social security
    5.Supplemental security income
    6.Public assistance
    7.Veterans’ payments
    8.Survivor benefits
    9.Disability benefits
    10.Pension or retirement income
    11.Interest
    12.Dividends
    13.Rents, royalties, and estates and trusts
    14.Educational assistance
    15.Alimony
    16.Child support
    17.Financial assistance from outside of the household
    18.Other income

    It should be noted that although the income statistics refer to receipts during the preceding calendar year, the demographic characteristics, such as age, labor force status, and family or household composition, are as of the survey date. The income of the family/household does not include amounts received by people who were members during all or part of the income year if these people no longer resided in the family/household at the time of interview. However, the CPS collects income data for people who are current residents but did not reside in the household during the income year.

    Data on consumer income collected in the CPS by the Census Bureau cover money income received (exclusive of certain money receipts such as capital gains) before payments for personal income taxes, social security, union dues, medicare deductions, etc. Therefore, money income does not reflect the fact that some families receive part of their income in the form of noncash benefits, such as food stamps, health benefits, rent-free housing, and goods produced and consumed on the farm. In addition, money income does not reflect the fact that noncash benefits are also received by some nonfarm residents which often take the form of the use of business transportation and facilities, full or partial payments by business for retirement programs, medical and educational expenses, etc. Data users should consider these elements when comparing income levels. Moreover, readers should be aware that for many different reasons there is a tendency in household surveys for respondents to underreport their income. Based on an analysis of independently derived income estimates, the Census Bureau determined that respondents report income earned from wages or salaries much better than other sources of income and that the reported wage and salary income is nearly equal to independent estimates of aggregate income.
    Oct 29, 2012. 03:11 AM | 2 Likes Like |Link to Comment
  • Economists Ignore 33,000,000 Americans When Calculating Income Inequality [View article]
    The Census Bureau measures income distribution once a year, in March. This is a special survey in addition to the monthly Current Population Surveys reporting unemployment - http://1.usa.gov/VwPWcG
    Oct 28, 2012. 11:09 AM | 1 Like Like |Link to Comment
  • Income Inequality For Households: A Long Biased History Of Gini And Mean Income [View article]
    I have developed a quantitative theory of personal income distribution and its evolution over time ◦ Ivan O. Kitov, 2009. "Mechanical model of personal income distribution," Working Papers 110, ECINEQ, Society for the Study of Economic Inequality, http://bit.ly/RlgihP . It describes quantiatively how personal income evolve with age and time. The observed time series published by the Census Bureau are well matched together with Gini ratios. The model does not contain any human factors except the number of people in a given age group. I think the model works because it does not include those human factors.
    Oct 25, 2012. 05:38 AM | Likes Like |Link to Comment
  • Unemployment In Spain May Reach 33% In 2013 [View article]
    In 2012, the rate of unemployment is 25.1% (October) which implies a 3.3% fall from 2011 with 21.8%. According to (2), the fall of 3.1 per cent in the rate of unemployment gives a -1.6% GDP fall in 2012. So, one needs only 6.5% fall in 2013 in order to get 33% unemployment.
    Oct 15, 2012. 02:17 AM | Likes Like |Link to Comment
  • Unemployment In Spain May Reach 33% In 2013 [View article]
    William, I did not invent this equation. THis is a modified Okun's law known since 1962. http://bit.ly/GRKXCc
    Oct 15, 2012. 02:08 AM | Likes Like |Link to Comment
  • Unemployment In The U.S. Will Fall To 6.2% By 2014 [View article]
    As a matter of fact, using the same approach we predicted the rate of participation in labor force to fall to 64.5% in 2007, i.e. three years before the fall. And published an article in 2008 (http://bit.ly/RKTnO9) .
    This is a link to our post in 2009 http://bit.ly/SXiJ8T
    By the way, all our models works in developed countries, not only for the US.
    Oct 8, 2012. 04:52 AM | 1 Like Like |Link to Comment
  • Unemployment In The U.S. Will Fall To 6.2% By 2014 [View article]
    I have another model linking the S&P 500 index to real GDP -http://bit.ly/TaODOU . It also indicates real GDP growth above 4% in Q3 or Q4 (quarter split is artificial). I am going to present this prediction before the Q3 figures are out.
    On the other hand all my models represent a feasibility study and show structural breaks (likely related to change in measutrement units). Therefore, I would not insist that the model is perfect despite it has been working since 2005 when it was developed and publsihed first.
    Oct 8, 2012. 02:12 AM | Likes Like |Link to Comment
  • Unemployment In The U.S. Will Fall To 6.2% By 2014 [View article]
    This is a physical model based on an assumption that people are particles whose sizes (incomes) are distributed as earthquake sizes. I am a seismologist.
    Oct 7, 2012. 04:18 PM | Likes Like |Link to Comment
  • Unemployment In The U.S. Will Fall To 6.2% By 2014 [View article]
    If Okun's law is quantitatively correct ( http://bit.ly/QWwu7v ) we will see the growth rate of real GDP above 4% in the fourth quarter of 2012 and through 2013. The problem is frequent revisions to GDP figures of a few percent.
    Oct 7, 2012. 04:14 PM | Likes Like |Link to Comment
  • Unemployment In The U.S. Will Fall To 6.2% By 2014 [View article]
    How many democrats are needed to bias unemployment figures?


    I do not consider any possibility that the Current Population Survey conducted by the U.S. Census Bureau for September 2012 is biased by CB or by the BLS, This is not the case. There is another hypothetical way to bias the data. There are around 70000 households surveyed by the CB. These households include approximately 200000 persons (mean household is 2.5 people). All these people (excluding several percent not responding ones) answer a few questions associated with their current status: employed, unemployed or not in the labor force. There current level of civilian labor force is approximately 155,000,00 with 12,000,000 unemployed. These figures are calculated by a projection of 200,000 to 310,000,000 using population controls. In essence, one person represents 1550 people.


    How many people are needed to increase the rate of unemployment by 0.1%? The rate of unemployment is calculated as the ratio of the number of unemployed and labor force. So, 0.1% of unemployment rate with the level of labor force of 155,000,000 corresponds to 155000. Since one person in the CPS represents 1550 people, one needs only 100 people to increase the rate of unemployment by 0.1%. To decrease the rate by 0.3% , only 300 (democrats -Spartans?) are needed.
    Oct 7, 2012. 10:22 AM | Likes Like |Link to Comment
  • Crude And Steel Prices Still In Sync [View article]
    Thank you for interest.
    currently, only a blog - http://bit.ly/VlJBVV
    We build up a site StockMarketScience to be launched any time soon.
    Oct 4, 2012. 11:56 AM | Likes Like |Link to Comment
  • Income Inequality For Households: A Long Biased History Of Gini And Mean Income [View article]
    It is difficult to judge without quality data. I was trying to play a bit around this problem (http://bit.ly/T2MmFs) but data for high income households of all sizes are not measured accurately enough. This is a question why the Census does not attack this important social/cultural/policy... problem appropriately?
    I have to notice again that the personal incomes obtained from the very same households do not show any fall in Gini ratio since 1994. This is a fact reported by the CB. I have calculated them back in the past to 1967 ( http://bit.ly/QJhEnW) and found no increase as well.
    Oct 4, 2012. 07:20 AM | Likes Like |Link to Comment
  • Income Inequality For Households: A Long Biased History Of Gini And Mean Income [View article]
    I would not agree with the assumption that poor households have a higher propensity to split. Obviously, poor families save lots of money living together. I would suggest that rich families have more reasons to break - their pieces have higher economic and financial viability. And the probability to break should increase with the average income.
    Unfortunately, the Census Bureau does not provide these important measurements for a longer time period and we can not prove any of the statements quantitatively. As you know, the CPS covers only 70,000 households and the higher incomes are not well represented. Also the CB limited the upper income bound to only $100,000 for all household sizes ($200,000 since 2009).
    For your convenience, I have more on household and personal income inequality in my blog (link is available at my author page).
    Oct 4, 2012. 03:37 AM | 1 Like Like |Link to Comment
  • Daily State Of The Markets: What Are The Cycles Saying Now? [View article]
    I wrote couple days ago that the level of S&P 500 is highly overvalued. Sold SPY this morning to fix 10% profit. Turbulent time is ahead. The S&P 500 will likely fall to 1375 in October/November. An opportunity to get another 10% by the end of 2013.
    Sep 19, 2012. 10:02 AM | Likes Like |Link to Comment
  • Time To Buy SPY [View instapost]
    I also have to admit that the model based on the number of 9-year-olds does not work well. The 2010 census has shown why. The Census Bureau severely suppresses actual changes in population cohorts and no true changes can be recovered. Therefore, the model failure is partly due to artificiality of population data.
    May 24, 2012. 04:01 AM | Likes Like |Link to Comment
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