At the same time as rising inequality has come to the fore as a focus for research and political debate, real incomes and living standards have stagnated in a significant number of OECD countries. This talk draws on research being carried out under the Employment, Equity and Growth Programme at INET Oxford. It uses data from the key comparative sources available for the rich countries to examine how both real median incomes and income inequality have evolved from around 1980 through the Great Recession. It shows first that there are striking differences across OECD countries in average real median income growth over the period that can be tracked in these comparative datasets – which itself varies across countries. It then looks at whether this appears to be related to what was happening to income inequality in the period in question. While some evidence of a significant negative association is found, inequality on its own or inequality together with GDP growth leave much of the variation in median incomes unaccounted for. This underpins recent argumentation that direct measures of how household incomes are evolving need to be central to monitoring progress towards inclusive growth. We look at some of the factors that contribute to GDP per capita in the national accounts diverging from median household income in surveys, and at how that varies across countries and over time. Finally, if growth in median or lower percentiles in the household income distribution is a ‘key performance indicator’ for economies and societies, we examine whether a best-performing model can be identified on the basis of experience over recent decades.
Presented by:
Brian Nolan (INET, University of Oxford)
Date & time:
February 1, 2016 4:00 pm - February 1, 2016 5:30 pm
Venue:
2N2.4.16
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