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European incomes, national advantages: EU-wide inequality and its decomposition by country and region

Stefano Filauro ()

EERI Research Paper Series from Economics and Econometrics Research Institute (EERI), Brussels

Abstract: This study analyses EU-28- and euro area-level income distribution with the latest EU-SILC data. More specifically it shows the evolution of inequality in net disposable and market incomes over the pre- and post-crisis period (2006-2013). I find that inequality between the EU-28 and euro area (EA) has converged due to a slow decrease in EU-28 inequality, at least until 2009, coupled with a mild increase in EA inequality. Thus, I compute how much between-country inequality, as opposed to within-country inequality, contributes to overall inequality in the EU-28 and euro area, observing that the trend of between-country inequality, albeit starting from very different levels, has been declining in the EU-28 while slightly increasing in the euro area. Similar trends are observed for between-region inequality. Finally, I approximate the extent to which individual incomes on the European scale can be predicted by country of residence and find evidence in line with the inequality decomposition by country.

Keywords: Distribution; income inequality; decomposition by country; European Union; equality of opportunity. (search for similar items in EconPapers)
JEL-codes: D3 D63 O52 (search for similar items in EconPapers)
Date: 2017-04-05
New Economics Papers: this item is included in nep-eur
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