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Global Earnings Inequality, 1970–2018

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  • Olle Hammar
  • Daniel Waldenström

Abstract

We estimate trends in global earnings dispersion across occupational groups by constructing a new database that covers 68 developed and developing countries between 1970 and 2018. Our main finding is that global earnings inequality has fallen, primarily during the 2000s and 2010s, when the global Gini coefficient dropped by 15 points and the earnings share of the world's poorest half doubled. Decomposition analyses show earnings convergence between countries and within occupations, while within-country earnings inequality has increased. Moreover, the falling global inequality trend was driven mainly by real wage growth, rather than changes in hours worked, taxes or occupational employment.

Suggested Citation

  • Olle Hammar & Daniel Waldenström, 2020. "Global Earnings Inequality, 1970–2018," The Economic Journal, Royal Economic Society, vol. 130(632), pages 2526-2545.
    • Handle: RePEc:oup:econjl:v:130:y:2020:i:632:p:2526-2545.
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    File URL: http://hdl.handle.net/10.1093/ej/ueaa109
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    Cited by:

    1. Benjamin Friedrich & Lisa Laun & Costas Meghir, 2022. "Earnings dynamics of immigrants and natives in Sweden 1985–2016," Quantitative Economics, Econometric Society, vol. 13(4), pages 1803-1847, November.
    2. Ranaldi, Marco, 2021. "Global Distributions of Capital and Labor Incomes: Capitalization of the Global Middle Class," SocArXiv 3g59r, Center for Open Science.
    3. Marta Escalonilla & Begoña Cueto & María José Pérez-Villadóniga, 2022. "Is the Millennial Generation Left Behind? Inter-Cohort Labour Income Inequality in a Context of Economic Shock," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 164(1), pages 285-321, November.

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