Who and What is the Middle Class
Start date: Aug 1, 2013,
End date: Jul 31, 2017
"The middle class attracts much attention in recent years, but little is known about who and what is (in the) middle class. We use new institutional social sciences theory and state of the art latent class analyses to answer both questions. We argue that what defines the middle class are institutions that protect access to education, health care, asset accumulation, descent income and personal safety. These are necessary conditions for being a productive member of the middle class. While poverty often ensues off a deficiency in one of those conditions, the very rich can probably forgo them. We use latent class analyses to learn the level of protection one needs to become a member and at what level of affluence can one afford to forgo these protections. Pilot studies demonstrated the feasibility of the project. We want to use larger data sets of different EU and OECD countries to study determinants of middle class membership in a cross geographies, time series. Our study will yield important information on what policies could strengthen the middle class. For example, the Achilles Heel of the U.S. middle class is access to health care. Health insurance is provided through employers, so if you lose your job you lose your health care coverage and a slippery slope to poverty ensues. About six million Americans lost their middle class status since 2007-8. They lost assets, jobs and health care, but the latter was the most significant in reducing Americans to poverty. We estimated that two millions regained the status with the enactment of Obama’s Affordable Care Act allowing parents to keep off-spring on their insurance policy until the age of 26. European countries have universal health care but the middle class is more vulnerable to unemployment swings. The ‘short work time’ program in Germany has been effective in helping Germans keep their middle class status. Our study will allow scholars and policy makers to sort out specific vulnerabilities of the middl"
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