Changes in the Profile of Inequality Across Europe Since 2005: Austerity & Redistribution

European Journal of Economics and Economic Policies: Intervention, Volume 13, Issue 3, December 2016

Posted: 20 Apr 2016 Last revised: 10 Dec 2016

See all articles by Markus P. A. Schneider

Markus P. A. Schneider

University of Denver

Stephen Kinsella

University of Limerick

Antoine Godin

Centre d'économie de l'Université de Paris Nord (CEPN); Agence Française de Développement (AFD); Hans-Boeckler-Stiftung - Macroeconomic Policy Institute (IMK)

Date Written: February 28, 2016

Abstract

The dual objectives of this paper are to present two inequality indices that provide a more nuanced picture of how the profile of inequality changed across European countries since 2005, and to use these indices to analyze the distributional changes that can be attributed to the push for austerity. We estimate the JV-indices for inequality at the top and the bottom for 24 European countries over 9 years. We then use this panel to understand the distributional effects of the fiscal consolidation policies Europe endured after the 2008 crisis. We find austerity deepened income inequality in Eurozone countries, but reduced income inequality in countries that do not use the euro as their currency. We uncover a significant new relationship between austerity policy and the tails of the income distribution, further suggesting that these policies on average amount to a redistribution from the bottom to the top.

Keywords: Austerity, Europe, Inequality, Income Distribution, Gini, Lorenz Curve

Suggested Citation

Schneider, Markus P. A. and Kinsella, Stephen and Godin, Antoine, Changes in the Profile of Inequality Across Europe Since 2005: Austerity & Redistribution (February 28, 2016). European Journal of Economics and Economic Policies: Intervention, Volume 13, Issue 3, December 2016. Available at SSRN: https://ssrn.com/abstract=2767021

Markus P. A. Schneider (Contact Author)

University of Denver ( email )

2201 S. Gaylord St
Denver, CO 80208-2685
United States
(303) 871 2146 (Phone)

HOME PAGE: http://portfolio.du.edu/MSCHNE58

Stephen Kinsella

University of Limerick ( email )

Limerick
Ireland
+35361233611 (Phone)
+35361330316 (Fax)

HOME PAGE: http://stephenkinsella.net

Antoine Godin

Centre d'économie de l'Université de Paris Nord (CEPN) ( email )

UMR7115
Université Paris-Nord
Paris XIII
France

Agence Française de Développement (AFD) ( email )

5, rue Roland Barthes
Paris Cedex 12, 75598
France

Hans-Boeckler-Stiftung - Macroeconomic Policy Institute (IMK) ( email )

Hans-Böckler-Straße 39
40476 Düsseldorf
Germany

Register to save articles to
your library

Register

Paper statistics

Abstract Views
375
PlumX Metrics