Between-Class Earnings Inequality in 30 European Countries

This article studies earnings inequality between social classes across 30 European countries. Class inequality in earnings is found across the board although there are some exceptions. However, the degree of class inequality varies strongly across countries being larger in Western and Southern European countries and smaller in Eastern and Northern European countries. Furthermore, we find that differences in class composition in terms of observed characteristics associated with earnings account for a substantial proportion of these between-class differences. Differences between classes in the returns to education and other characteristics play less of a role. In all these respects there is a sizeable cross-national variation. This points to important differences between countries in how earnings are structured by social class.

Occupational Social Class and Earnings Inequality in Europe: A Comparative Assessment

While there is renewed interest in earnings differentials between social classes, the contribution of social class to overall earnings inequality across countries and net of compositional effects remains largely uncharted territory. This paper uses data from the European Union Statistics on Income and Living Conditions to assess earnings differentials between social classes (as measured by ESeC) and the role of between-class inequality in overall earnings inequality across 30 European countries. We find that there is substantial variation in earnings differences between social classes across countries. Countries with higher levels of between-class inequality tend to display higher levels of overall earnings inequality, but this relationship is far from perfect. Even with highly aggregated class measures, between-class inequality accounts for a non-negligible share of total earnings inequality (between 15 and 25% in most countries). Controlling for observed between-class differences in composition shows that these account for much of the observed between-class earnings inequality, while in most countries between-class differences in returns to observed compositional variables do not play a major role. In all these respects we find considerable variation across countries, implying that both the size of between-class differences in earnings and the primary mechanisms that produce these class differences vary substantially between European countries.

Human Capital Disparities and Earnings Inequality in The Portuguese Private Labour Market

This paper examines human capital inequality and how it relates to earnings inequality in Portugal using data from Quadros de Pessoal for the period 1986–2017. The objective is threefold: (i) show how the distribution of human capital has evolved over time; (ii) investigate the association between human capital inequality and earnings inequality; and (iii) analyse the role of returns to schooling, together with human capital inequality, in the explanation of earnings inequality. Our findings suggest that human capital inequality, computed based on the distribution of average years of schooling of employees working in the Portuguese private labour market, records a positive trend until 2007 and decreases from this year onwards, suggesting the existence of a Kuznets curve of education relating educational attainment levels and education inequality. Based on the decomposition of a Generalized Entropy index (Theil N) for earnings inequality, we observe that inequality in the distribution of human capital plays an important role in the explanation of earnings inequality, although this role has become less important over the last decade. Using Mincerian earnings regressions to estimate the returns to schooling together with the Blinder-Oaxaca decomposition of real hourly earnings we confirm that there are two important forces associated with the observed decrease in earnings inequality: a reduction in education inequality and compressed returns to schooling, mainly in tertiary education.

Nonstandard Employment and Indigenous Earnings Inequality in Canada

The study investigates the extent to which the type of employment, specifically nonstandard work, may contribute to a better understanding of Indigenous earnings disparities. We find that Indigenous workers are overrepresented in nonstandard jobs and that such forms of work are associated with sizable earnings penalties. Although Indigenous earnings disparities are smaller in nonstandard work than in standard employment, the relatively low earnings of many nonstandard jobs are an important factor contributing to the overall economic inequalities experienced by many Indigenous Canadians. Policy responses aimed at improved human capital accumulation are likely to have limited efficacy unless additional barriers that prevent many Indigenous workers from accessing better quality employment and internal labor markets are identified and removed.