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Pay Inequality in Europe 1995-2000: Convergence Between Countries and Stability Inside

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  • James Galbraith
  • Enrique Garcilazo

Abstract

This paper measures pay inequality in the EU during the convergence process to the Monetary Union. The decomposability property of Theil's T statistic permits us to construct a three-level hierarchical panel data set of pay inequalities for the years 1995-2000: between and within regions, countries, and for the European continent as a whole. We find a marked pattern of declining pay inequality across Europe for this period, which is due mainly to the rising (initially, negative) position of the United Kingdom and decreasing positive position of Germany.

Suggested Citation

  • James Galbraith & Enrique Garcilazo, 2005. "Pay Inequality in Europe 1995-2000: Convergence Between Countries and Stability Inside," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 2(2), pages 139-175, December.
    • Handle: RePEc:liu:liucej:v:2:y:2005:i:2:p:139-175
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    References listed on IDEAS

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    1. Sala-i-Martin, Xavier X, 1996. "The Classical Approach to Convergence Analysis," Economic Journal, Royal Economic Society, vol. 106(437), pages 1019-1036, July.
    2. Sapir, Andre & Aghion, Philippe & Bertola, Giuseppe & Hellwig, Martin & Pisani-Ferry, Jean & Rosati, Dariusz & Vinals, Jose & Wallace, Helen, 2004. "An Agenda for a Growing Europe: The Sapir Report," OUP Catalogue, Oxford University Press, number 9780199271498.
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    4. Damien Neven & Claudine Gouymte, 1995. "Regional Convergence in the European Community," Journal of Common Market Studies, Wiley Blackwell, vol. 33(1), pages 47-65, March.
    5. James K. Galbraith & Hyunsub Kum, 2005. "Estimating The Inequality Of Household Incomes: A Statistical Approach To The Creation Of A Dense And Consistent Global Data Set," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 51(1), pages 115-143, March.
    6. Diego Puga, 2002. "European regional policies in light of recent location theories," Journal of Economic Geography, Oxford University Press, vol. 2(4), pages 373-406, October.
    7. Miriam Beblo & Thomas Knaus, 2001. "Measuring Income Inequality in Euroland," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 47(3), pages 301-333, September.
    8. Michael Happich & Kurt Geppert, 2003. "A note on regional convergence within the EU," Applied Economics Letters, Taylor & Francis Journals, vol. 10(8), pages 523-525.
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    Cited by:

    1. Cristiano Perugini & Gaetano Martino, 2008. "Income Inequality Within European Regions: Determinants And Effects On Growth," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 54(3), pages 373-406, September.
    2. Țibulcă Ioana Laura, 2015. "Does Fiscal Convergence Lead to tax Convergence? Evidence from the Eurozone," Scientific Annals of Economics and Business, Sciendo, vol. 62(s1), pages 1-9, October.
    3. David Castells-Quintana & Raul Ramos & Vicente Royuela, 2015. "Income inequality in European Regions: Recent trends and determinants," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 35(2), pages 123-146, October.

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    More about this item

    Keywords

    Inequality; Unemployment; Wage Level and Structure; Europe; Regional Labor Markets;
    All these keywords.

    JEL classification:

    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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