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Trends in individual income growth: measurement Methods and British evidence

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  • Jenkins, Stephen P.
  • van Kerm, Philippe

Abstract

Assessments of whose income growth is the greatest and whose is the smallest are typically based on comparisons of income changes for income groups (e.g. rich versus poor) or income values (e.g. quantiles). However, income group and quantile composition changes over time because of income mobility. To summarize patterns of income growth while also tracking the fortunes of the same individuals, a longitudinal perspective is required. For this case, we develop dominance conditions and summary indices for comparisons of distributions of individual income growth, together with associated methods of estimation and inference. Using these methods and data from the British Household Panel Survey, we study individual income growth for periods between 1991 and 2005. We show that income growth was significantly more pro-poor in the early years of the Labour government than in earlier Conservative years.

Suggested Citation

  • Jenkins, Stephen P. & van Kerm, Philippe, 2011. "Trends in individual income growth: measurement Methods and British evidence," LSE Research Online Documents on Economics 58209, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:58209
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    References listed on IDEAS

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    1. Fields, Gary S. & Leary, Jesse B. & Ok, Efe A., 2002. "Stochastic dominance in mobility analysis," Economics Letters, Elsevier, vol. 75(3), pages 333-339, May.
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    Cited by:

    1. Flaviana Palmisano & Dirk Van de gaer, 2016. "History-dependent growth incidence: a characterization and an application to the economic crisis in Italy," Oxford Economic Papers, Oxford University Press, vol. 68(2), pages 585-603.
    2. Vito Peragine & Flaviana Palmisano & Paolo Brunori, 2014. "Economic Growth and Equality of Opportunity," World Bank Economic Review, World Bank Group, vol. 28(2), pages 247-281.
    3. Iryna Kyzyma, 2014. "Changes in the Patterns of Poverty Duration in Germany, 1992–2009," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(S2), pages 305-331, November.
    4. Thomas Groll & Peter J. Lambert, 2013. "The Pro-Poorness, Growth and Inequality Nexus: Some Findings From a Simulation Study," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 59(4), pages 776-784, December.
    5. Flaviana Palmisano & Vito Peragine, 2015. "The Distributional Incidence of Growth: A Social Welfare Approach," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 61(3), pages 440-464, September.
    6. KYZYMA Iryna, 2013. "Changes in the patterns of poverty duration in Germany, 1992-2009," LISER Working Paper Series 2013-06, LISER.
    7. Jantti, Markus & Jenkins, Stephen P., 2013. "Income mobility," ISER Working Paper Series 2013-23, Institute for Social and Economic Research.
    8. Aristei, David & Perugini, Cristiano, 2015. "The drivers of income mobility in Europe," Economic Systems, Elsevier, vol. 39(2), pages 197-224.
    9. Mike Brewer & Liam Wren-Lewis, 2016. "Accounting for Changes in Income Inequality: Decomposition Analyses for the UK, 1978–2008," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 78(3), pages 289-322, June.
    10. Florent Bresson & Jean-Yves Duclos & Flaviana Palmisano, 2015. "Intertemporal pro-poorness," SERIES 03-2015, Dipartimento di Economia e Finanza - Università degli Studi di Bari "Aldo Moro", revised Jul 2015.
    11. repec:bla:jageco:v:68:y:2017:i:2:p:471-493 is not listed on IDEAS
    12. Allanson, Paul & Petrie, Dennis, 2013. "Longitudinal methods to investigate the role of health determinants in the dynamics of income-related health inequality," Journal of Health Economics, Elsevier, vol. 32(5), pages 922-937.
    13. Paul Gregg & Rosanna Scutella & Claudia Vittori, 2012. "Earnings Mobility and Inequality: An Integrated Framework," The Centre for Market and Public Organisation 12/295, Department of Economics, University of Bristol, UK.
    14. Rod Hick, 2016. "Between Income and Material Deprivation in the UK: In Search of Conversion Factors," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 17(1), pages 35-54, February.
    15. Van Kerm, Philippe & Pi Alperin, Maria Noel, 2013. "Inequality, growth and mobility: The intertemporal distribution of income in European countries 2003–2007," Economic Modelling, Elsevier, vol. 35(C), pages 931-939.
    16. Shatakshee Dhongde & Jacques Silber, 2016. "On distributional change, pro-poor growth and convergence," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(3), pages 249-267, September.
    17. Paul Allanson & Kalina Kasprzyk & Andrew P. Barnes, 2017. "Income Mobility and Income Inequality in Scottish Agriculture," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(2), pages 471-493, June.
    18. Claire Lebarz, 2015. "Income Inequality and Household Debt Distribution: A Cross-Country Analysis using Wealth Surveys," LWS Working papers 20, LIS Cross-National Data Center in Luxembourg.
    19. Flaviana Palmisano, 2012. "The distributional incidence of growth: a non-anonymous and rank dependent approach," SERIES 0039, Dipartimento di Economia e Finanza - Università degli Studi di Bari "Aldo Moro", revised Jul 2012.

    More about this item

    Keywords

    individual income growth; pro-poor growth; progressive income growth; income mobility; mobility profile; British household panel survey;

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics

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