Aggregate Earnings Inequality in Europe: Permanent Differences or Transitory Fluctuations?
This paper examines the relationship between aggregate inequality and its underlying components for a number of European countries. We use a well established GMM approach to separate the permanent component from the transitory component of earnings inequality. Our results show that three quarters of the observed cross-country differences in aggregate inequality in Europe is accounted for by differences in permanent inequality, reflecting differences in individual characteristics that persist throughout the life-cycle.
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| Length: | 13 pages |
| Date of creation: | 2010 |
| Date of revision: | |
| Handle: | RePEc:may:mayecw:n211-10.pdf |
| Contact details of provider: | Postal: Maynooth, Co. Kildare Phone: 353-1-7083728 Fax: 353-1-7083934 Web page: http://www.maynoothuniversity.ie/economics-finance-and-accounting More information through EDIRC
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