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Equilibrium and convergence in personal income distribution? How European countries performed during a phase of huge economic turbulence (2004-2017)


  • Guo, Yanling
  • Sell, Friedrich L.


The authors set up a political economy equilibrium framework for personal income distribution. Located in status theory, their concept is able to explain what justifies a certain or optimal degree of inequality in the society. The authors present an empirical analysis of personal income distribution in 23 European countries. The time period covers the years before, during and after the great recession (2004-2017). Linear regressions, which make use of ex-post Gini coefficients, show that the hypothesis of the existence of an equilibrium value for the Gini-coefficient can be weakly confirmed, after controlling for a possible impact from the great recession as well as from EU membership.

Suggested Citation

  • Guo, Yanling & Sell, Friedrich L., 2020. "Equilibrium and convergence in personal income distribution? How European countries performed during a phase of huge economic turbulence (2004-2017)," Working Papers in Economics 2020,1, Bundeswehr University Munich, Economic Research Group.
  • Handle: RePEc:zbw:ubwwpe:20201

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    References listed on IDEAS

    1. Eurosystem Household Finance and Consumption Network, 2013. "The Eurosystem Household Finance and Consumption Survey - Methodological report," Statistics Paper Series 1, European Central Bank.
    2. Kaitila, Ville, 2013. "Convergence, income distribution, and the economic crisis in Europe," ETLA Working Papers 14, The Research Institute of the Finnish Economy.
    3. Friedrich L. Sell, 2015. "The New Economics of Income Distribution," Books, Edward Elgar Publishing, number 15663.
    4. Eurosystem Household Finance and Consumption Network, 2013. "The Eurosystem Household Finance and Consumption Survey - Results from the first wave," Statistics Paper Series 2, European Central Bank.
    5. Ismail Genc & Jon Miller & Anil Rupasingha, 2011. "Stochastic convergence tests for US regional per capita personal income; some further evidence: a research note," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 46(2), pages 369-377, April.
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    More about this item


    Political Economy; Personal Income Distribution; Equilibrium; Convergence; Redistributive Policies; Great Recession; EU Membership;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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