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Middle Class Fortunes in Western Europe

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  • Rakesh Kochhar

Abstract

This paper examines the state of the middle classes in the U.S. and 11 countries in Western Europe and how it has changed since 1991. Among Western Europe’s six largest economies, the shares of adults living in middle-income households increased in France, the Netherlands and the United Kingdom from 1991 to 2010, but shrank in Germany, Italy and Spain. France, the Netherlands and the UK also experienced notable growth in disposable household income, but incomes were either stagnant or falling in Germany, Italy and Spain. Ireland stands out as experiencing the most rapid growth in income from 1991 to 2010 and the biggest expansion of the middle class. Overall, the middle-class share fell in seven of the 11 Western European countries examined, mirroring the long-term shrinking of the middle class in the U.S. The decrease in the middle-class share is typically accompanied by a move up into the upper-income tier and a move down into the lower-income tier.

Suggested Citation

  • Rakesh Kochhar, 2017. "Middle Class Fortunes in Western Europe," LIS Working papers 702, LIS Cross-National Data Center in Luxembourg.
    • Handle: RePEc:lis:liswps:702
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    References listed on IDEAS

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    1. David Autor & David Dorn & Gordon Hanson & Kaveh Majlesi, 2020. "Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure," American Economic Review, American Economic Association, vol. 110(10), pages 3139-3183, October.
    2. Mr. Michael Kumhof & Mr. Romain Ranciere & Pablo Winant, 2013. "Inequality, Leverage and Crises: The Case of Endogenous Default," IMF Working Papers 2013/249, International Monetary Fund.
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    Cited by:

    1. Schneider-Kamp, Anna & Takhar, Jennifer, 2023. "Interrogating the pill: Rising distrust and the reshaping of health risk perceptions in the social media age," Social Science & Medicine, Elsevier, vol. 331(C).
    2. Bögenhold, Dieter & Permana, Muhammad Yorga, 2018. "End of Middle-Classes? Social Inequalities in Digital Age," MPRA Paper 87202, University Library of Munich, Germany.
    3. Regina Pleninger & Jakob de Haan & Jan‐Egbert Sturm, 2022. "The ‘Forgotten’ middle class: An analysis of the effects of globalisation," The World Economy, Wiley Blackwell, vol. 45(1), pages 76-110, January.

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    Keywords

    Income distribution; real income; inequality;
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