Inequality Trends for Germany in the Last Two Decades: A Tale of Two Countries

65 Pages Posted: 3 Sep 2009

See all articles by Nicola Fuchs-Schündeln

Nicola Fuchs-Schündeln

Goethe University Frankfurt

Dirk Krueger

University of Pennsylvania - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Mathias C. Sommer

University of Mannheim - Mannheim Research Institute for the Economics of Aging (MEA)

Multiple version iconThere are 2 versions of this paper

Date Written: June 1, 2009

Abstract

In this paper we document inequality trends in wages, hours worked, earnings, consumption, and wealth for Germany from the last twenty years. We generally find that inequality was relatively stable in West Germany until the German unification (which happened politically in 1990 and in our data in 1991), and then trended upwards for wages and market incomes, especially after about 1998. Disposable income and consumption, on the other hand, display only a modest increase in inequality over the same period. These trends occured against the backdrop of lower trend growth of earnings, incomes and consumption in the 1990s relative to the 1980s. In the second part of the paper we further analyze the differences between East and West Germans in terms of the evolution of levels and inequality of wages, income, and consumption.

Keywords: Inequality, German Unification

JEL Classification: D31, D33, E24

Suggested Citation

Fuchs-Schündeln, Nicola and Krueger, Dirk and Sommer, Mathias C., Inequality Trends for Germany in the Last Two Decades: A Tale of Two Countries (June 1, 2009). MEA Discussion Paper No. 184, Available at SSRN: https://ssrn.com/abstract=1466918 or http://dx.doi.org/10.2139/ssrn.1466918

Nicola Fuchs-Schündeln (Contact Author)

Goethe University Frankfurt ( email )

Grueneburgplatz 1
Frankfurt am Main, 60323
Germany

Dirk Krueger

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-6691 (Phone)
215-573-2057 (Fax)

HOME PAGE: http://www.econ.upenn.edu/~dkrueger/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Mathias C. Sommer

University of Mannheim - Mannheim Research Institute for the Economics of Aging (MEA) ( email )

D-68131 Mannheim
Germany
+49 621 181 3436 (Phone)

HOME PAGE: http://www.mea.uni-mannheim.de

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