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Income Inequality and Incentives. The Quasi-Natural Experiment of Hungary 1914-2008

Author

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  • Dimitris Mavridis

    (uni.lu - Université du Luxembourg = University of Luxembourg = Universität Luxemburg)

  • Pálma Mosberger

    (CEU - Central European University [Budapest, Hongrie], European Commission [Brussels])

Abstract

We construct the first top income share series of a formerly socialist economy before, during, and after socialism in order to exploit the quasi-natural experiment of the absence of markets on incentives and income inequality. We investigate top income shares dynamics and the sources of income at the upper tail of the income distri- bution. Within this setup, we study the effect of capital markets and liberalized wage settings on top income shares. Our estimates show that the introduction of wage-setting decentralization had a role in increasing the skill premium and income inequality in years prior the transition.

Suggested Citation

  • Dimitris Mavridis & Pálma Mosberger, 2017. "Income Inequality and Incentives. The Quasi-Natural Experiment of Hungary 1914-2008," Working Papers halshs-02797438, HAL.
    • Handle: RePEc:hal:wpaper:halshs-02797438
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-02797438v1
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    References listed on IDEAS

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    1. Bengtsson, Erik & Waldenström, Daniel, 2018. "Capital Shares and Income Inequality: Evidence from the Long Run," The Journal of Economic History, Cambridge University Press, vol. 78(3), pages 712-743, September.
    2. Yuouri Ivanov, 1987. "Possibilities And Problems Of Reconciliation Of The Sna And The Mps," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 33(1), pages 1-18, March.
    3. Broadberry,Stephen & Harrison,Mark (ed.), 2005. "The Economics of World War I," Cambridge Books, Cambridge University Press, number 9780521852128, January.
    4. Douglas Gollin, 2001. "Getting Income Shares Right," Department of Economics Working Papers 2001-11, Department of Economics, Williams College.
    5. Héthy, Lajos., 1990. "Urban self-employment in Hungary," ILO Working Papers 992754553402676, International Labour Organization.
    6. Alexander Eckstein, 1955. "National Income And Capital Formation In Hungary, 1900–1950," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 5(1), pages 152-223, December.
    7. Atkinson,Anthony Barnes & Micklewright,John, 1992. "Economic Transformation in Eastern Europe and the Distribution of Income," Cambridge Books, Cambridge University Press, number 9780521433297, January.
    8. Schulze, Max-Stephan, 2000. "Patterns of growth and stagnation in the late nineteenth century Habsburg economy," European Review of Economic History, Cambridge University Press, vol. 4(3), pages 311-340, December.
    9. Wicker, Elmus R, 1986. "Terminating Hyperinflation in the Dismembered Habsburg Monarchy," American Economic Review, American Economic Association, vol. 76(3), pages 350-364, June.
    10. Douglas Gollin, 2002. "Getting Income Shares Right," Journal of Political Economy, University of Chicago Press, vol. 110(2), pages 458-474, April.
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    Citations

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    Cited by:

    1. Filip Novokmet & Thomas Piketty & Gabriel Zucman, 2018. "From Soviets to oligarchs: inequality and property in Russia 1905-2016," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 16(2), pages 189-223, June.
    2. Thomas Blanchet & Lucas Chancel & Amory Gethin, 2022. "Why Is Europe More Equal than the United States?," American Economic Journal: Applied Economics, American Economic Association, vol. 14(4), pages 480-518, October.
    3. Pawel Bukowski & Filip Novokmet, 2019. "Between communism and capitalism: long-term inequality in Poland, 1892-2015," CEP Discussion Papers dp1628, Centre for Economic Performance, LSE.
    4. Pawel Bukowski & Filip Novokmet, 2019. "Between Communism and Capitalism: Long-Term Inequality in Poland, 1892- 2015," World Inequality Lab Working Papers hal-02876995, HAL.
    5. Bukowski, Pawel & Novokmet, Filip, 2019. "Between communism and capitalism: long-term inequality in Poland, 1892-2015," LSE Research Online Documents on Economics 102814, London School of Economics and Political Science, LSE Library.
    6. Pawel Bukowski & Filip Novokmet, 2019. "Between Communism and Capitalism: Long-Term Inequality in Poland, 1892- 2015," Working Papers hal-02876995, HAL.
    7. Bukowski, Pawel & Novokmet, Filip, 2021. "Between communism and capitalism: long-term inequality in Poland, 1892–2015," LSE Research Online Documents on Economics 110221, London School of Economics and Political Science, LSE Library.
    8. Bukowski, Pawel & Novokmet, Filip, 2019. "Between communism and capitalism: long-term inequality in Poland, 1892-2015," LSE Research Online Documents on Economics 102834, London School of Economics and Political Science, LSE Library.
    9. Paweł Bukowski & Filip Novokmet, 2021. "Between communism and capitalism: long-term inequality in Poland, 1892–2015," Journal of Economic Growth, Springer, vol. 26(2), pages 187-239, June.

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