More Evidence on the Effect of Higher Unemployment on the Canadian Size Distribution of Income

Susan Johnson

Canadian Public Policy, 1995, vol. 21, issue 4, 423-428

Abstract: This paper provides evidence that cyclical unemployment is associated with increased income inequality in Canada. The empirical results reinforce the recent findings of Erksoy (1981-1987). Erksoy used a dynamic micro-simulation to model the period from 1981 to 1987. In contrast to his work, my paper takes a macroeconomic perspective and uses an income share model. I examine the period from 1981 to 1992 using data from the "Survey of Consumer Finances." It is striking that two such different approaches reach the same conclusion.

Date: 1995
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