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More Unequal, But More Mobile? Earnings Inequality and Mobility in OECD Countries

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  • Garnero, Andrea

    (OECD)

  • Hijzen, Alexander

    (OECD)

  • Martin, Sébastien

    (OECD)

Abstract

This paper provides comprehensive cross-country evidence on the relationship between earnings inequality and intra-generational mobility by simulating individual earnings and employment trajectories in the long-term using short panel data for 24 OECD countries. On average across countries, about 25% of earnings inequality in a given year evens out over the life cycle as a result of mobility. Moreover, mobility is not systematically higher in countries with more earnings inequality in general. However, a positive and statistically significant relationship is found only in the bottom of the distribution. This reflects the role of mobility between employment and unemployment and not that of mobility up and down the earnings ladder.

Suggested Citation

  • Garnero, Andrea & Hijzen, Alexander & Martin, Sébastien, 2016. "More Unequal, But More Mobile? Earnings Inequality and Mobility in OECD Countries," IZA Discussion Papers 9753, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp9753
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    1. More Unequal, But More Mobile? Earnings Inequality and Mobility in OECD Countries
      by maximorossi in NEP-LTV blog on 2016-04-07 18:38:50

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    Cited by:

    1. Garnero, Andrea & Hijzen, Alexander & Martin, Sébastien, 2019. "More unequal, but more mobile? Earnings inequality and mobility in OECD countries," Labour Economics, Elsevier, vol. 56(C), pages 26-35.
    2. Lucas Chancel, 2019. "Ten facts about income inequality in advanced economies," World Inequality Lab Working Papers hal-02876982, HAL.
    3. Pullman, Ashley & Gauly, Britta & Lechner, Clemens M., 2021. "Short-term earnings mobility in the Canadian and German context: the role of cognitive skills," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 55(55), pages 1-.10.
    4. Chiara Criscuolo & Alexander Hijzen & Cyrille Schwellnus & Erling Barth & Wen-Hao Chen & Richard Fabling & Priscilla Fialho & Balazs Stadler & Richard Upward & Wouter Zwysen & Katarzyna Grabska-Romago, 2020. "Workforce composition, productivity and pay: the role of firms in wage inequality," OECD Economics Department Working Papers 1603, OECD Publishing.
    5. Monica BURESCU MIHĂILA & Paula Roxana CUCOȘ, 2023. "Implications of migration policies on reducing income inequalities and poverty in Europe," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(635), S), pages 23-42, Summer.
    6. Martinez, Isabel Z., 2017. "Die Topeinkommen in der Schweiz seit 1980: Verteilung und Mobilität [Top incomes in Switzerland since 1980: Distribution and Mobility]," MPRA Paper 84330, University Library of Munich, Germany.
    7. Yang, Xiaoliang & Zhou, Peng, 2022. "Wealth inequality and social mobility: A simulation-based modelling approach," Journal of Economic Behavior & Organization, Elsevier, vol. 196(C), pages 307-329.
    8. repec:iab:iabjlr:v:55:i::p:art.10 is not listed on IDEAS
    9. Frédéric Teulon & Guillaume Bigot & Bernard Terrany & Negar Youssefian, 2016. "Rémunérations des PDG : toniques ou toxiques ? Une mise en perspective de la littérature," Post-Print hal-01865108, HAL.
    10. Ashley Pullman & Britta Gauly & Clemens M. Lechner, 2021. "Short-term earnings mobility in the Canadian and German context: the role of cognitive skills," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 55(1), pages 1-19, December.
    11. Dean R. Lillard, 2021. "Cross‐National Research: Realised and Potential Contributions," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(4), pages 542-553, December.
    12. Birgitta Jansson, 2021. "Income inequality and intragenerational income mobility in Sweden from 1983 to 2010: Following two birth cohorts," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 158(2), pages 751-773, December.
    13. Pullman, Ashley & Gauly, Britta & Lechner, Clemens M., 2021. "Short-term earnings mobility in the Canadian and German context: the role of cognitive skills," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 55, pages 1-10.
    14. Zbigniew Mogila & Patricia C. Melo & José M. Gaspar, 2020. "Exploring the relation between income mobility and inequality at the regional level using EU-SILC microdata," Working Papers REM 2020/0134, ISEG - Lisbon School of Economics and Management, REM, Universidade de Lisboa.

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    More about this item

    Keywords

    earnings-experience profiles; life-time inequality; intra-generational mobility; simulation;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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