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Income Inequality and Mobility: A Nonparametric Decomposition Analysis by Age for Switzerland in the 80s and 90s

  • Boris A. Zürcher
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    This paper investigates income inequality and mobility for the prime age working population of Switzerland in the early 80s and 90s. The empirical methods applied are based on nonparametric kernel density estimation. Mobility is interpreted here in terms of inequality reduction when the accounting period for income is extended. We find that income inequality increased between the early 80s and early 90s. The computation of within inequality reveals that age explains a significant fraction of total inequality. An important component of inequality is due to short-term deviations from the long-run income profile. Mobility in the sense of inequality reduction has declined for market income, but in turn increased for disposable income.

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    Article provided by Swiss Society of Economics and Statistics (SSES) in its journal Swiss Journal of Economics and Statistics.

    Volume (Year): 140 (2004)
    Issue (Month): II (June)
    Pages: 265-292

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    Handle: RePEc:ses:arsjes:2004-ii-5
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    1. Maasoumi, Esfandiar, 1986. "The Measurement and Decomposition of Multi-dimensional Inequality," Econometrica, Econometric Society, vol. 54(4), pages 991-97, July.
    2. Härdle, W.K., 1992. "Applied Nonparametric Methods," Discussion Paper 1992-6, Tilburg University, Center for Economic Research.
    3. Maasoumi, Esfandiar & Zandvakili, Sourushe, 1990. "Generalized entropy measures of mobility for different sexes and income levels," Journal of Econometrics, Elsevier, vol. 43(1-2), pages 121-133.
    4. repec:cup:cbooks:9780521429504 is not listed on IDEAS
    5. Gottschalk, Peter & Smeeding, Timothy M., 2000. "Empirical evidence on income inequality in industrialized countries," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 5, pages 261-307 Elsevier.
    6. Shorrocks, Anthony, 1978. "Income inequality and income mobility," Journal of Economic Theory, Elsevier, vol. 19(2), pages 376-393, December.
    7. Oliver LINTON, . "Applied nonparametric methods," Statistic und Oekonometrie 9312, Humboldt Universitaet Berlin.
    8. Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September.
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