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Long Run Trends in Income Inequality in the United States, UK, Sweden, Germany and Canada: A Birth Cohort View

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  • Lars Osberg

    (Economics Department, Dalhousie University)

Abstract

This paper examines the level and distribution of equivalent after tax, after transfer money income in Canada, the United States, the UK, Germany and Sweden using micro-data from the Luxembourg Income Study from 1969/70 to 1994/95. It concentrates on inequality within and between birth cohorts. At any point in time, less than 11% of aggregate income inequality is due to intergenerational inequality. Although median income growth of different birth cohorts over the period has varied widely across countries, there has been a general trend to greater income inequality within cohorts since 1980. The five countries studied differ in the trends observed in aggregate income, poverty, polarization and income inequality. In the United States and the UK, the incomes of the top decile of each cohort have risen dramatically, but the incomes of the bottom quintile have stagnated. In Canada and Sweden both the top and bottom deciles of each cohort have experienced similar trends. Germany is an intermediate case.

Suggested Citation

  • Lars Osberg, 2003. "Long Run Trends in Income Inequality in the United States, UK, Sweden, Germany and Canada: A Birth Cohort View," Eastern Economic Journal, Eastern Economic Association, vol. 29(1), pages 121-141, Winter.
    • Handle: RePEc:eej:eeconj:v:29:y:2003:i:1:p:121-141
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    References listed on IDEAS

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    Cited by:

    1. Aboozar Hadavand, 2017. "Misperceptions and mismeasurements: An analysis of subjective economic inequality," Working Papers 449, ECINEQ, Society for the Study of Economic Inequality.
    2. Markus Moos, 2014. "Generational Dimensions of Neoliberal and Post-Fordist Restructuring: The Changing Characteristics of Young Adults and Growing Income Inequality in Montreal and Vancouver," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 38(6), pages 2078-2102, November.
    3. Marc Frenette & David A. Green & Kevin Milligan, 2007. "The tale of the tails: Canadian income inequality in the 1980s and 1990s," Canadian Journal of Economics, Canadian Economics Association, vol. 40(3), pages 734-764, August.
    4. Gabriella Berloffa & Paola Villa, 2007. "Inequality across cohorts of households: evidence from Italy," Department of Economics Working Papers 0711, Department of Economics, University of Trento, Italia.
    5. Esa Karonen & Mikko Niemelä, 2020. "Life Course Perspective on Economic Shocks and Income Inequality Through Age‐Period‐Cohort Analysis: Evidence From Finland," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 66(2), pages 287-310, June.
    6. Louis Chauvel & Martin Schröder, 2014. "Generational Inequalities and Welfare Regimes," LIS Working papers 606, LIS Cross-National Data Center in Luxembourg.
    7. Alessio Tomelleri, 2020. "The Role of Temporary Jobs in Explaining Increasing Inequality for Recent Cohorts in Italy," BEMPS - Bozen Economics & Management Paper Series BEMPS71, Faculty of Economics and Management at the Free University of Bozen.
    8. Alessio Tomelleri, 2021. "Temporary jobs and increasing inequality for recent cohorts in Italy," LABOUR, CEIS, vol. 35(4), pages 500-537, December.
    9. Aboozar Hadavand, 2017. "Anatomy of Income Inequality in the United States: 1979-2013," LIS Working papers 686, LIS Cross-National Data Center in Luxembourg.
    10. Lars Osberg & Andrew Sharpe, 2003. "Human Well-being and Economic Well-being: What Values Are Implicit in Current Indices?," CSLS Research Reports 2003-04, Centre for the Study of Living Standards.
    11. Green, David A. & Milligan, Kevin & Frenette, Marc, 2006. "Revisiting Recent Trends in Canadian After-Tax Income Inequality Using Census Data," Analytical Studies Branch Research Paper Series 2006274e, Statistics Canada, Analytical Studies Branch.

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    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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