Do Left-Wing Governments Decrease Wage Inequality Among Civil Servants? Empirical Evidence from the German States

32 Pages Posted: 3 Dec 2020

See all articles by Björn Kauder

Björn Kauder

German Economic Institute

Manuela Krause

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Niklas Potrafke

CESifo (Center for Economic Studies and Ifo Institute)

Date Written: 2020

Abstract

We investigate whether left-wing governments decrease wage inequality among civil servants. The data is based on salaries of civil servants in the German states. Since a reform in 2006, German state governments are allowed to design salaries of civil servants. We employ encompassing data for pay levels and professions including judges, professors, policemen, and administrators and distinguish between levels of operating experiences. We use six wage inequality measures comparing salaries across pay levels and operating experiences. The results do not suggest that left-wing governments were more active in decreasing wage inequality among civil servants than center or right-wing governments. Cabinet members are civil servants themselves and decide on their own salaries: government ideology is also not shown to predict salaries of cabinet members. Because left-wing governments are perceived as taking action against income and wage inequality, future research should employ data from other federal states such as the United States to examine how government ideology influences salaries of civil servants.

JEL Classification: D720, H700, A130, P160

Suggested Citation

Kauder, Björn and Krause, Manuela and Potrafke, Niklas, Do Left-Wing Governments Decrease Wage Inequality Among Civil Servants? Empirical Evidence from the German States (2020). CESifo Working Paper No. 8723, Available at SSRN: https://ssrn.com/abstract=3740335 or http://dx.doi.org/10.2139/ssrn.3740335

Björn Kauder (Contact Author)

German Economic Institute ( email )

Konrad-Adenauer-Ufer 21
Köln, 50459
Germany

Manuela Krause

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

Niklas Potrafke

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

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