A Cross-National Comparison Of Permanent Inequality In The United States And Germany

Richard Burkhauser and John G. Poupore

The Review of Economics and Statistics, 1997, vol. 79, issue 1, 10-17

Abstract: Traditional cross-sectional measures find greater inequality in the United States than in industrialized Western European countries, but are unable to distinguish transitory from permanent inequality. With longitudinal data, we measure cross-sectional inequality during the 1980s using the Shorrocks measure of income stability to find the degree to which single-period measures exaggerate permanent inequality. Surprisingly, given the smaller social welfare system and the less restrictive labor markets in the United States, we find that both single-period inequality and the share of that inequality that persists over time are greater in the United States than in Germany. © 2001 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

Date: 1997
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