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Does Growth Affect the Nature of Inequality? Ireland 1994–2001

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Author Info
Doris, Aedin () (National University of Ireland, Maynooth)
O'Neill, Donal () (National University of Ireland, Maynooth)
Sweetman, Olive () (National University of Ireland, Maynooth)

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Abstract

Much has been written about the relationship between economic growth and aggregate inequality in recent years. In this paper we extend this literature by examining whether economic growth affects, not the level, but rather the nature of inequality. To do this we focus on the Irish economy which experienced a remarkable boom starting in 1994. We analyse the covariance structure of earnings in Ireland to examine whether this rapid growth affected earnings dynamics over the period. Using panel data for the years 1994–2001, we show that, while permanent inequality in Ireland is high, the degree of persistence of inequality was not significantly affected by the rapid growth in the economy.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3701.

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Length: 33 pages
Date of creation: Sep 2008
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Handle: RePEc:iza:izadps:dp3701

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Related research
Keywords: permanent and transitory inequality;

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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    Other versions:
  2. Barrett, Alan & FitzGerald, John & Nolan, Brian, 2002. "Earnings inequality, returns to education and immigration into Ireland," Labour Economics, Elsevier, vol. 9(5), pages 665-680, November. [Downloadable!] (restricted)
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  3. Adele Bergin, 2008. "Job Mobility in Ireland," Economics, Finance and Accounting Department Working Paper Series n1940708.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth. [Downloadable!]
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  6. Dickens, Richard, 2000. "The Evolution of Individual Male Earnings in Great Britain: 1975-95," Economic Journal, Royal Economic Society, vol. 110(460), pages 27-49, January. [Downloadable!] (restricted)
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  10. Chamberlain, Gary, 1984. "Panel data," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 22, pages 1247-1318 Elsevier. [Downloadable!] (restricted)
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  13. Daly, Mary C. & Valletta, Robert G., 2008. "Cross-national trends in earnings inequality and instability," Economics Letters, Elsevier, vol. 99(2), pages 215-219, May. [Downloadable!] (restricted)
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