Inequality and Ordinary Living Standards in OECD Countries

2018 ◽  
Author(s):  
Brian Nolan ◽  
Stefan Thewissen
Keyword(s):  
Empirical Relationship ◽  
Real Income ◽  
Living Standards ◽  
Income Growth ◽  
Lower Income ◽  
Key Factors ◽  
Recent Commentary ◽  
The Rich ◽  
Rich Countries ◽  
Distribution Of Income

This chapter focuses on how the patterns of real income growth or stagnation seen in Chapter 2 are related to changes to inequality in the distribution of income, which has played such a prominent role in recent commentary and debate. It examines how income inequality has evolved over recent decades across the rich countries, both overall and in terms of the share going to the very top of the distribution, and highlights key factors in driving inequality upwards—albeit differentially across countries and time-periods. The ways in which rising inequality may undermine real income growth for middle and lower income households are discussed, and the empirical relationship between inequality and such real income growth over recent decades across the rich countries is analysed. Alongside real income growth or its absence, some other ways of looking at whether ‘the middle’ has been ‘squeezed’ in income terms are also explored.

The Evolution of Living Standards for Middle and Lower Income Households in OECD Countries

2018 ◽  
Author(s):  
Brian Nolan ◽  
Stefan Thewissen
Keyword(s):  
Comparative Analysis ◽  
Income Distribution ◽  
Real Income ◽  
Living Standards ◽  
Entire Population ◽  
Income Growth ◽  
Lower Income ◽  
Working Age ◽  
The Rich ◽  
Rich Countries

This chapter carries out and presents the findings from an in-depth comparative analysis of real income growth around and below the middle of the income distribution across the rich countries of the OECD over recent decades. It examines trends in real incomes for the entire population and for working age households only, and sets the evolution of incomes around the middle in each country against what has been happening lower down and higher up the distribution. This allows the range of experiences across countries in these terms to be captured, providing the base which subsequent chapters seek to probe and get behind.

Inequality and Living Standards

2018 ◽  
Author(s):  
Michael Förster ◽  
Brian Nolan
Keyword(s):  
Income Inequality ◽  
Income Distribution ◽  
Real Income ◽  
Comparative Data ◽  
Living Standards ◽  
Income Growth ◽  
The Rich ◽  
Rich Countries

This chapter provides an overview of how inequality and living standards have evolved across the rich countries of the OECD in recent decades, of the factors driving income inequality upwards in many of them, and of the channels through which this may undermine real income growth and opportunity for households across the middle and lower parts of the income distribution. It presents an overview of key trends drawing on comparative data from the OECD’s Income Distribution Database. It reviews existing evidence on the drivers of income inequality and on how inequality may affect income growth around the middle. It highlights key gaps in knowledge, to be addressed by the in-depth examination of the varying experiences of a range of rich countries in this book.

Generating Prosperity for Working Families in Affluent Countries

2018 ◽  
Keyword(s):  
Economic Growth ◽  
Real Income ◽  
Living Standards ◽  
Financial Strain ◽  
Inclusive Growth ◽  
Working Families ◽  
The Rich ◽  
Rich Countries ◽  
Analysis Of Performance

This book addresses the central challenge facing rich countries: how to ensure that ordinary working families see their living standards and the prospects for their children improve rather than stagnate over time. It presents the findings from a comprehensive analysis of performance over recent decades across the rich countries of the OECD, in terms of real income growth around and below the middle. It relates this performance to overall economic growth, exploring why these often diverge substantially, and to the different models of capitalism or economic growth embedded in different countries. In-depth comparative and UK-focused analyses also focus on wages and the labour market and on the role of redistribution. Going beyond income, other indicators and aspects of living standards are also incorporated including non-monetary indicators of deprivation and financial strain, wealth and its distribution, and intergenerational mobility. By looking across this broad canvas, the book teases out how ordinary households have fared in recent decades in these critically important respects, and how that should inform the quest for inclusive growth and prosperity.

Introduction

2018 ◽  
Author(s):  
Brian Nolan
Keyword(s):  
Economic Growth ◽  
Living Standards ◽  
Inclusive Growth ◽  
Central Concern ◽  
Working Families ◽  
The Rich ◽  
Rich Countries

This chapter sets out the central challenge facing rich countries, on which this volume is focused: how to restore inclusive economic growth and prosperity. It describes how rising inequality in the rich countries over recent decades is now widely seen as undermining growth and even more so the living standards and prospects of ordinary working families. It reviews key themes in the debate about why inequality has been rising, and why this should be such a central concern. The chapter then outlines the approach taken in this book, which is to examine in depth the experiences of ten rich countries, posing the same set of questions about what has happened to inequality and ordinary living standards over recent decades, and why. The aim is to learn from these varying experiences, analysed through a common lens, about how inclusive growth can best be supported.

Sources of Household Income Growth in Rich Countries

2018 ◽  
Author(s):  
Brian Nolan ◽  
Stefan Thewissen ◽  
Alice Lazzati
Keyword(s):  
Household Income ◽  
Social Insurance ◽  
Real Income ◽  
Income Growth ◽  
Social Transfers ◽  
Household Members ◽  
Key Features ◽  
Rich Countries ◽  
Different Sources ◽  
Over Time

This chapter seeks to capture what underpins patterns of real income growth versus stagnation for those around and below the middle by distinguishing the different sources of income they receive—in terms of the earnings of different household members, investment income, pensions, and social transfers, as well as the direct taxes and social insurance contributions deducted. The role each of these sources play in household income and its growth over time across countries is explored, bringing out both the key features of incomes around the middle versus towards the top and bottom of the distribution, and which sources have been key to sustained growth for those households.

Median Household Income and GDP

2018 ◽  
Author(s):  
Brian Nolan ◽  
Max Roser ◽  
Stefan Thewissen
Keyword(s):  
Household Income ◽  
National Income ◽  
Real Income ◽  
Living Standards ◽  
Income Growth ◽  
Median Household Income ◽  
Macroeconomic Performance ◽  
Potential Explanation ◽  
Over Time

This chapter investigates the extent to which real income growth for households around the middle is seen to diverge from growth in national income per head—the most widely-used metric for assessing overall macroeconomic performance. While the concentration of income gains at the top of the distribution examined in Chapter 3 is one potential explanation, it is by no means the only one. A range of distinct factors that may contribute are described and their importance assessed across countries and over time. The implications are brought out both for understanding what drives ordinary living standards and for how they are best monitored and assessed.

Conclusions and Implications

2018 ◽  
Author(s):  
Brian Nolan
Keyword(s):  
Real Income ◽  
Living Standards ◽  
Income Growth ◽  
Common Elements ◽  
Wage Setting ◽  
Market Institutions ◽  
Individual Country ◽  
Country Case Study ◽  
Welfare State Regimes

This chapter brings together the findings from the ten individual country case-study chapters to highlight the lessons to be learned about inequality and living standards. It highlights the extent to which countries facing what might be thought of as common drivers in terms of globalization and technological change none the less had very different outcomes in terms of increases in inequality and real income growth. This variation did not align neatly with pre-existing welfare-state regimes or economic models, but some common elements can be identified in countries or periods where increases in inequality were limited, and ones where significant real income increases were achieved. The chapter brings out the implications in terms of macroeconomic policy, employment, wage-setting, and labour-market institutions and policies, and redistributive mechanisms as well as broader social provision and supports.

scholarly journals Inequality and its discontents

2019 ◽  
Vol 35 (3) ◽  
pp. 396-430 ◽  
Author(s):  
Brian Nolan ◽  
Luis Valenzuela
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Technological Change ◽  
National Institutions ◽  
Social Domains ◽  
The Rich ◽  
Rich Countries ◽  
Distribution Of Income

Abstract Inequality in the distribution of income and wealth has come to the fore as a core concern across the industrialized world. Here we examine what has happened to income inequality across the rich countries in recent decades. We discuss the range of factors that appear to be driving inequality upwards, notably the role of technological change, globalization, and national institutions and policies. We look at how rising inequality might undermine economic growth and squeeze the middle, and assess the extent to which it has actually done so. We assess whether rising inequality is associated with worsening outcomes and inequalities across various social domains. Finally, we review emerging evidence on the role that rising inequality may be playing in the ‘revolt of the angry’ and rise of populism.

scholarly journals Seasonal work and welfare in an early industrial town: Newcastle upon Tyne, 1600–1700

2017 ◽  
Vol 32 (2) ◽  
pp. 157-182 ◽  
Author(s):  
ANDY BURN
Keyword(s):  
Real Income ◽  
Living Standards ◽  
Rapid Expansion ◽  
North East ◽  
Industrial Town ◽  
North Eastern ◽  
Transport Workers ◽  
Newcastle Upon Tyne ◽  
Distribution Of Income ◽  
Agricultural Labourers

AbstractThe port of Newcastle upon Tyne in north-east England was transformed in the seventeenth century by the rapid expansion of its coal trade, which demanded an influx of industrial transport workers known as ‘keelmen’. This article assesses wages, perks and the seasonal distribution of income for this growing group of workers, estimating that their real income rose until about 1680, before tailing off again. They were comparatively well paid, but their work was inconsistent and seasonal. The number of days' work available was crucial to welfare in Newcastle, as were a series of formal and informal measures intended to relieve winter poverty and maintain a year-round workforce. Combining quantitative and qualitative evidence, this article offers a north-eastern industrial perspective on English living standards debates that still tend to be dominated by south-eastern building and agricultural labourers.

scholarly journals Rising Income Inequality and Living Standards in OECD Countries: How Does the Middle Fare?

2018 ◽  
pp. 1-23
Author(s):  
Stefan Thewissen ◽  
Lane Kenworthy ◽  
Brian Nolan ◽  
Max Roser ◽  
Tim Smeeding
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Oecd Countries ◽  
Living Standards ◽  
Income Growth ◽  
The Past ◽  
Past Generation ◽  
Top Income Shares ◽  
The Rich ◽  
Household Incomes

Income inequality has increased in a number of the rich democratic nations over the past generation. We examine whether this has reduced income growth for middleincome households. Using LIS, OECD and WID data, we show how median household incomes and income inequality have evolved between 1980 and 2013, and we analyse whether these trends are related. Growth in median incomes is negatively associated with changes in the Gini but not with changes in top income shares. Economic growth is strongly associated with growth in median incomes, although it does not seem to fully transmit.

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