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Income Mobility – Curse or Blessing? Mobility in Social Security Earnings: Data on West-German Men since 1950

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  • Uwe Fachinger
  • Ralf K. Himmelreicher

Abstract

Descriptions and analyses of citizens' or households' income have a long tradition in economics. A large body of research has recognized that levels of income and how income is distributed are important contributors to the wealth of nations. Within the broader context of income and its distribution, there has also been a considerable amount of research on the process underlying income distribution that is, income mobility. The relevance of income mobility is manifold. First of all, mobility is an indicator for an open society providing economic opportunities for everyone. As people are normally risk averse, they are interested in a steady income stream. This can be called the security aspect. Another facet of income mobility is the incentive aspect. Upward mobility provides incentives for successful economic activity as it is possible to move up the income ladder. If upward mobility offers the “carrot”, downward mobility epitomizes the “stick” of economic activity. Downward mobility increases insecurity and insecurity is harmful to well-being. We use data covering the whole working lives of workers/employees to shed light on income mobility. This will result in more information about the adequacy of some assumptions of the life-cycle theory concerning the development of income over time – and especially on the inverse U-shape assumption of income profiles.

Suggested Citation

  • Uwe Fachinger & Ralf K. Himmelreicher, 2012. "Income Mobility – Curse or Blessing? Mobility in Social Security Earnings: Data on West-German Men since 1950," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 132(2), pages 175-203.
  • Handle: RePEc:aeq:aeqsjb:v132_y2012_i2_q2_p175-203
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    File URL: http://dx.doi.org/10.3790/schm.132.2.175
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    References listed on IDEAS

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    1. Antoni, Manfred & Jacobebbinghaus, Peter & Seth, Stefan, 2011. "ALWA-Befragungsdaten verknüpft mit administrativen Daten des IAB 1975-2009 (ALWA-ADIAB 7509)," FDZ Datenreport. Documentation on Labour Market Data 201105, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    2. Antoni, Manfred & Drasch, Katrin & Kleinert, Corinna & Matthes, Britta & Ruland, Michael & Trahms, Annette, 2011. "Working and learning in a changing world : Part I: Overview of the study - March 2011 (Second, updated version)," FDZ Methodenreport 201005_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    3. Bernd Fitzenberger & Aderonke Osikominu & Robert Völter, 2006. "Imputation Rules to Improve the Education Variable in the IAB Employment Subsample," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 126(3), pages 405-436.
    4. Corinna Kleinert & Britta Matthes & Manfred Antoni & Katrin Drasch & Michael Ruland & Annette Trahms, 2011. "ALWA – New Life Course Data for Germany," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 131(4), pages 625-634.
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    Cited by:

    1. Jurgen Faik & Uwe Fachinger, 2013. "The decomposition of well-being categories: An application to Germany," Working Papers 307, ECINEQ, Society for the Study of Economic Inequality.

    More about this item

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • B16 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Quantitative and Mathematical
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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