Income Inequality and Income Mobility in the Scandinavian Countries Compared to the United States

Abstract

This paper compares income inequality and income mobility in the Scandinavian countries and the United States during the 1980's. The results demonstrate that inequality is greater in the United States than in the Scandinavian countries and that the ranking of countries with respect to inequality remains unchanged when the accounting period of income is extended from one to 11 years. The pattern of mobility turns out to be remarkably similar despite major differences in labor market and social policies between the Scandinavian countries and the United States.Keywords: Income inequality, income mobility. JEL classification: D31Acknowledgement The authors would like to thank the discussant Stephen P Jenkins for helpful comments. We also thank Stephen E. Rhody and seminar pa rticipants at the University of Michigan and the University of Western Ontario.

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