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GINI Country Report: Growing Inequalities and their Impacts in Luxembourg

Listed author(s):
  • Alessio Fusco

    ()

    (Centre for Population, Poverty and Public Policy Studies / International Networks for Studies in Technology, Environment, Alternatives, Development (CEPS/INSTEAD))

  • Philippe Kerm

    ()

    (CEPS/INSTEAD)

  • A. Alieva
  • L. Bellani
  • F. Etienne-Robert
  • A.-C. Guio
  • I. Kyzyma
  • K. Leduc
  • P. Liégeois
  • M.N.P. Alperin
  • A. Reinstadler
  • E. Sierminska
  • D. Sologon
  • P. Thill
  • M. Valentova
  • B. Voicu

Luxembourg experienced remarkable economic performance and employment growth since the middle of the 1980s. Based on the development of the financial sector, this growth benefited massively from the contribution of immigrants and cross-border workers to the domestic labour force. High economic growth led to a rapid improvement of the overall living standard of the resident population. During the same period, income inequality increased too, albeit modestly. Even if the country can still be considered a low inequality country by international standards, this trend is a potential source of concern. Several factors may explain the increase in income inequality. Income source decomposition analysis reveals that the relative contribution of paid employment income to total inequality increased over time. This reflects major labour market evolutions: (i) the expansion of the high-wage financial sector, (ii) an increase in the female employment rate, mainly married women, as well as (iii) an increase in earnings inequality. The recent upward trend in the unemployment rate also coincided with a period of increasing inequality. Finally, the analysis of education inequalities shows that for both men and women the share of highly educated increased while the share of low educated remained stable. This changing educational inequalities and the change in skills required by the structural change from a heavy industry based society to a high value-added service society also influenced income inequality.

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Paper provided by AIAS, Amsterdam Institute for Advanced Labour Studies in its series GINI Country Reports with number luxembourg.

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Date of creation: Apr 2013
Handle: RePEc:aia:ginicr:luxembourg
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  1. Mathä, Thomas Y. & Porpiglia, Alessandro & Sierminska, Eva, 2011. "The immigrant/native wealth gap in Germany, Italy and Luxembourg," Working Paper Series 1302, European Central Bank.
  2. Brian Nolan & Christopher T Whelan, 2011. "The EU 2020 Poverty Target," Working Papers 201111, Geary Institute, University College Dublin.
  3. Thomas Y. Mathä & Alessandro Porpiglia & Michael Ziegelmeyer, 2012. "The Luxembourg Household Finance and Consumption Survey (LU-HFCS): Introduction and Results," BCL working papers 73, Central Bank of Luxembourg.
  4. SIERMINSKA Eva & DOORLEY Karina, 2012. "Decomposing household wealth portfolios across countries: An age-old question?," LISER Working Paper Series 2012-32, LISER.
  5. PI ALPERIN Maria Noel & BERZOSA Guayarmina, 2011. "A fuzzy logic approach to measure overweight," LISER Working Paper Series 2011-55, LISER.
  6. Eva Sierminska & Andrea Brandolini & Timothy Smeeding, 2006. "The Luxembourg Wealth Study – A cross-country comparable database for household wealth research," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 4(3), pages 375-383, December.
  7. Philippe Liégeois & Frédéric Berger & Nizamul Islam & Raymond Wagener, 2011. "Cross-validating administrative and survey datasets through microsimulation," International Journal of Microsimulation, International Microsimulation Association, vol. 4(1), pages 54-71.
  8. FUSCO Alessio & GUIO Anne-Catherine & MARLIER Eric, 2011. "Income poverty and material deprivation in European countries," LISER Working Paper Series 2011-04, LISER.
  9. Buti,Marco & Deroose,Servaas & Gaspar,Vitor & Martins,João Nogueira (ed.), 2010. "The Euro," Cambridge Books, Cambridge University Press, number 9789279098420, May.
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