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How unification and immigration affected the German income distribution

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  • Grabka, Markus M.
  • Schwarze, Johannes
  • Wagner, Gert G.

Abstract

The German economy is not only affected by unification of Germany but by a significant influx of immigrants from abroad and huge migration from East to West Germany around the date of unification. Data from the German Socio-Economic Panel Study (GSOEP) allows one to disentangle those effects by decomposition of the Theil I(0)-Index of inequality. In addition, the paper offers insights into the transition from a socalist economy into a market oriented one.
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Suggested Citation

  • Grabka, Markus M. & Schwarze, Johannes & Wagner, Gert G., 1999. "How unification and immigration affected the German income distribution," European Economic Review, Elsevier, vol. 43(4-6), pages 867-878, April.
    • Handle: RePEc:eee:eecrev:v:43:y:1999:i:4-6:p:867-878
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    1. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-625, April.
    2. Johannes Schwarze, 1996. "How Income Inequality Changed In Germany Following Reunification: An Empirical Analysis Using Decomposable Inequality Measures," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 42(1), pages 1-11, March.
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    8. Jantti, Markus, 1997. "Inequality in Five Countries in the 1980s: The Role of Demographic Shifts, Markets and Government Policies," Economica, London School of Economics and Political Science, vol. 64(255), pages 415-440, August.
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    Cited by:

    1. Mary Keeney, 2000. "The Distributional Impact of Direct Payments on Irish Farm Incomes," Journal of Agricultural Economics, Wiley Blackwell, vol. 51(2), pages 252-265, May.
    2. Gulgun Bayaz-Ozturk & Richard V. Burkhauser & Kenneth A. Couch, 2014. "Consolidating The Evidence On Income Mobility In The Western States Of Germany And The United States From 1984 To 2006," Economic Inquiry, Western Economic Association International, vol. 52(1), pages 431-443, January.
    3. Gulgun Bayaz-Ozturk & Richard V. Burkhauser & Kenneth A. Couch, 2012. "Consolidating the Evidence on Income Mobility in the Western States of Germany and the U.S. from 1984-2006," NBER Working Papers 18618, National Bureau of Economic Research, Inc.
    4. Joachim Frick & Jan Goebel, 2008. "Regional Income Stratification in Unified Germany Using a Gini Decomposition Approach," Regional Studies, Taylor & Francis Journals, vol. 42(4), pages 555-577.
    5. Joachim R. Frick & Markus M. Grabka, 2000. "Personelle Einkommensverteilung und der Einfluß von Imputed Rent," Discussion Papers of DIW Berlin 225, DIW Berlin, German Institute for Economic Research.
    6. Amelie Constant & Yochanan Shachmurove, 2006. "Entrepreneurial ventures and wage differentials between Germans and immigrants," International Journal of Manpower, Emerald Group Publishing Limited, vol. 27(3), pages 208-229, April.
    7. Martin Biewen, 2005. "The Covariance Structure of East and West German Incomes and its Implications for the Persistence of Poverty and Inequality," German Economic Review, Verein für Socialpolitik, vol. 6(4), pages 445-469, November.
    8. Biewen, Martin, 2002. "Bootstrap inference for inequality, mobility and poverty measurement," Journal of Econometrics, Elsevier, vol. 108(2), pages 317-342, June.
    9. Louis Chauvel & Anne Hartung & Flaviana Palmisano, 2017. "Dynamics of Income Rank Volatility: Evidence from Germany and the US," SOEPpapers on Multidisciplinary Panel Data Research 926, DIW Berlin, The German Socio-Economic Panel (SOEP).
    10. Richard A. Easterlin & Anke Zimmermann, 2006. "Life Satisfaction and Economic Outcomes in Germany Pre- and Post-Unification," IEPR Working Papers 06.58, Institute of Economic Policy Research (IEPR).
    11. Gulgun Bayaz Ozturk, 2011. "Supply and Demand Factors in Understanding the Educational Earnings Differentials: West Germany and the United States," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 8(2), pages 235-263, December.
    12. Regina T. Riphahn, 2002. "Bruttoeinkommensverteilung in Deutschland 1984 - 1999 und Ungleichheit unter ausländischen Erwerbstätigen," Discussion Papers of DIW Berlin 272, DIW Berlin, German Institute for Economic Research.

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    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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