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Labour Shares and Income Inequality: Insights from Italian Economic History, 1895-2015

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  • Giacomo Gabbuti

Abstract

This paper develops theoretical and practical motivations for studying the functional distribution of income in the past. Italy is adopted as a case study, by reason of the availability of long-run estimates on personal income inequality. The historical importance of self-employment and the recent increase in labour’s share make the Italian historical experience of further general interest. New estimates from 1895 show Italian workers accruing a low share of national income until 1945. By the end of the 1950s and the economic miracle, shares had rapidly converged to the European average. Italian history shows that studying the functional distribution of income deepens our understanding of long run distributional trends, as well as of key distributive episodes, and makes a compelling case for approaching income inequality by combining diverse sources and methodologies.

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  • Giacomo Gabbuti, 2018. "Labour Shares and Income Inequality: Insights from Italian Economic History, 1895-2015," HHB Working Papers Series 13, The Historical Household Budgets Project.
    • Handle: RePEc:hbu:wpaper:13
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    Cited by:

    1. Marco Ranaldi, 2022. "Income Composition Inequality," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 68(1), pages 139-160, March.
    2. Roberto Iacono & Marco Ranaldi, 2023. "The Evolution of Income Composition Inequality in Italy, 1989–2016," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 69(1), pages 124-149, March.
    3. Petrova, Bilyana & Ranaldi, Marco, 2021. "Determinants of Income Composition Inequality," SocArXiv vyrz7, Center for Open Science.
    4. Giacomo Gabbuti, 2020. "A Noi! Income Inequality and Italian Fascism: Evidence from Labour and Top Income Shares," Oxford Economic and Social History Working Papers _177, University of Oxford, Department of Economics.
    5. Marco Ranaldi, 2016. "On the Measurement of Functional Income Distribution," Documents de travail du Centre d'Economie de la Sorbonne 16051rrr, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne, revised Oct 2018.
    6. Marco Ranaldi, 2018. "On the Measurement of Functional Income Distribution," Post-Print halshs-01379229, HAL.

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    More about this item

    Keywords

    economic inequality; factor shares; functional distribution; Italy; labour share;
    All these keywords.

    JEL classification:

    • B12 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Classical (includes Adam Smith)
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-

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