IDEAS home Printed from https://ideas.repec.org/p/lis/liswps/386.html
   My bibliography  Save this paper

Income Distribution in 14 OECD Nations, 1967-2000: Evidence from the Luxembourg Income Study

Author

Listed:
  • Thomas Volscho, Jr.

Abstract

This paper advances the understanding of income inequality by examining quintile shares of income among households headed by someone age 25-59 in 14 OECD nations. In examining quintile shares, the author attempts to resolve the contradictory findings from past research. Furthermore, the analysis is restricted to working-age households for two reasons: 1) many of the theoretical explanations considered in this paper are premised upon labor market conditions (e.g., the role of imports from less developed countries, unemployment) and 2) recent analyses have examined this population because some analysts contend that the welfare state redistributes income among age groups. Following the lead of several recent studies, two concepts of income are examined: 1) market-generated income and 2) all income after taxes and transfers. By focusing on market-generated income and income after taxes and transfers, the analyses can provide insight into how various factors influence the distribution of income obtained in the market as well as how these same factors influence the distribution of income after government mediation through taxes and transfers. Several explanations of income inequality are mentioned at the beginning of the paper: macroeconomic, trade and industrial sector, class struggle, government wage setting, and welfare spending. As a departure from past research, quintile shares are examined instead of summary indices of income inequality. By examining quintile shares it is argued that it is possible to 1) resolve some of the discrepant findings in past literature, 2) gain a better sense of the location in the distribution at which different variables impact income inequality, and 3) obtain estimates of the magnitude of the effect different factors have on income inequality.

Suggested Citation

  • Thomas Volscho, Jr., 2004. "Income Distribution in 14 OECD Nations, 1967-2000: Evidence from the Luxembourg Income Study," LIS Working papers 386, LIS Cross-National Data Center in Luxembourg.
    • Handle: RePEc:lis:liswps:386
    as

    Download full text from publisher

    File URL: http://www.lisdatacenter.org/wps/liswps/386.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jay Teachman & Greg J. Duncan & W. Jean Yeung & Dan Levy, 2001. "Covariance Structure Models for Fixed and Random Effects," Sociological Methods & Research, , vol. 30(2), pages 271-288, November.
    2. David Brady, 2003. "The Politics of Poverty: Left Political Institutions, the Welfare State and Poverty," LIS Working papers 352, LIS Cross-National Data Center in Luxembourg.
    3. Nord, Stephen, 1990. "Service Industries, Two-Working Spouse Families, and the Distribution of Earnings in Metropolitan Areas," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 692-696, November.
    4. Blinder, Alan S & Esaki, Howard Y, 1978. "Macroeconomic Activity and Income Distribution in the Postwar United States," The Review of Economics and Statistics, MIT Press, vol. 60(4), pages 604-609, November.
    5. Albert Chevan & Randall Stokes, 2000. "Growth in family income inequality, 1970–1990: Industrial restructuring and demographic change," Demography, Springer;Population Association of America (PAA), vol. 37(3), pages 365-380, August.
    6. H. Naci Mocan, 1999. "Structural Unemployment, Cyclical Unemployment, and Income Inequality," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 122-134, February.
    7. Joakim Palme & Walter Korpi, 1998. "The Paradox of Redistribution and Strategies of Equality: Welfare State Institutions, Inequality and Poverty in the Western Countries," LIS Working papers 174, LIS Cross-National Data Center in Luxembourg.
    8. Arne L. Kalleberg & Michael Wallace & Lawrence E. Raffalovich, 1984. "Accounting for Labors Share: Class and Income Distribution in the Printing Industry," ILR Review, Cornell University, ILR School, vol. 37(3), pages 386-402, April.
    9. Blanchflower, David G & Oswald, Andrew J, 1994. "Estimating a Wage Curve for Britain: 1973-90," Economic Journal, Royal Economic Society, vol. 104(426), pages 1025-1043, September.
    10. Michael Podgursky, 1983. "Unions and Family Income Inequality," Journal of Human Resources, University of Wisconsin Press, vol. 18(4), pages 574-591.
    11. Nolan, Brian, 1986. "Unemployment and the Size Distribution of Income," Economica, London School of Economics and Political Science, vol. 53(212), pages 421-445, November.
    12. Vanessa Strauss-Kahn, 2004. "The Role of Globalization in the Within-Industry Shift Away from Unskilled Workers in France," NBER Chapters, in: Challenges to Globalization: Analyzing the Economics, pages 209-231, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kevin Leicht & David Brady, 2007. "Party to Inequality: Right Party Power and Income Inequality in Affluent Western Democracies," LIS Working papers 460, LIS Cross-National Data Center in Luxembourg.
    2. Cysne, Rubens Penha & Turchick, David, 2012. "Equilibrium unemployment-inequality correlation," Journal of Macroeconomics, Elsevier, vol. 34(2), pages 454-469.
    3. Chen Wang & Kees Goudswaard & Koen Caminada, 2012. "Disentangling Income Inequality and the Redistributive Effect of Taxes and Transfers in 20 LIS Countries Over Time Evidence from the LIS Data," LIS Working papers 581, LIS Cross-National Data Center in Luxembourg.
    4. Caminada, Koen & Goudswaard, Kees & Wang, Chen, 2012. "Disentangling income inequality and the redistributive effect of taxes and transfers in 20 LIS countries over time," MPRA Paper 42350, University Library of Munich, Germany.
    5. Koen Caminada & Kees Goudswaard & Chen Wang & Jinxian Wang, 2019. "Income Inequality and Fiscal Redistribution in 31 Countries After the Crisis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(1), pages 119-148, March.
    6. David Brady, 2003. "The Politics of Poverty: Left Political Institutions, the Welfare State and Poverty," LIS Working papers 352, LIS Cross-National Data Center in Luxembourg.
    7. Cysne, Rubens Penha, 2004. "Towards a measure of income inequality freed from the volatility caused by variations in the rate of unemployment," FGV EPGE Economics Working Papers (Ensaios Economicos da EPGE) 560, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil).
    8. Marika Karanassou & Hector Sala, 2012. "Inequality and Employment Sensitivities to the Falling Labour Share," The Economic and Social Review, Economic and Social Studies, vol. 43(3), pages 343-376.
    9. Neil Lee, 2011. "Are Innovative Regions More Unequal? Evidence from Europe," Environment and Planning C, , vol. 29(1), pages 2-23, February.
    10. Denise Kall & David Brady, 2007. "Nearly Universal, but Somewhat Distinct: The Feminization of Poverty in Affluent Western Democracies, 1969-2000," LIS Working papers 462, LIS Cross-National Data Center in Luxembourg.
    11. Branimir Jovanovic, 2014. "Inflation and the Rich After the Global Financial Crisis," LIS Working papers 613, LIS Cross-National Data Center in Luxembourg.
    12. Markus Jäntti & Stephen Jenkins, 2010. "The impact of macroeconomic conditions on income inequality," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(2), pages 221-240, June.
    13. Oguzhan C. Dincer & Burak Gunalp, 2012. "Corruption And Income Inequality In The United States," Contemporary Economic Policy, Western Economic Association International, vol. 30(2), pages 283-292, April.
    14. Helder Ferreira de Mendonça & Diogo Martins Esteves, 2018. "Monetary authority's transparency and income inequality," Review of Development Economics, Wiley Blackwell, vol. 22(4), pages 202-227, November.
    15. David Brady, 2004. "The Welfare State and Relative Poverty in Rich Western Democracies, 1967-1997," LIS Working papers 390, LIS Cross-National Data Center in Luxembourg.
    16. Salvatore Morelli, 2018. "Banking crises in the US: the response of top income shares in a historical perspective," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 16(2), pages 257-294, June.
    17. Marika Karanassou & Héctor Sala, 2020. "Distributional Consequences of Technology, Trade Globalisation and Financialisation in the US," The Economic and Social Review, Economic and Social Studies, vol. 51(2), pages 275-303.
    18. Joya Misra & Stephanie Moller, 2005. "Familialism and Welfare Regimes: Poverty, Employment and Family Policies," LIS Working papers 399, LIS Cross-National Data Center in Luxembourg.
    19. Mehdi El Herradi & Jakob Haan & Aurélien Leroy, 2023. "Inflation and the Income Share of the Rich: Evidence for 14 OECD Countries," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 69(1), pages 170-194, March.
    20. Mehdi el Herradi & Jakob de Haan & Aurélien Leroy, 2020. "Inflation and the Income Share of the Rich: Evidence for 12 OECD Countries," CESifo Working Paper Series 8203, CESifo.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:lis:liswps:386. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Piotr Paradowski (email available below). General contact details of provider: https://edirc.repec.org/data/lisprlu.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.