Discussion Paper, School of Business & Economics: Economics 2014/30
Studying lifetime income inequality for individuals who belong to the same cohort can contribute valuable insights that cannot be obtained by usual analyses of annual incomes. Data from the social security system indicates that in West Germany, over the cohorts born between 1935 and 1972, lifetime earnings inequality has strongly increased. For male baby-boomers, lifetime inequality is predicted to be 85 % larger than in the case of their fathers. This is larger than the increase of inequality in the cross-section and points to dramatic intergenerational changes in the German labor market.