Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/271846 
Year of Publication: 
2023
Series/Report no.: 
CESifo Working Paper No. 10202
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
This paper investigates inequality and intragenerational economic mobility in a developing country with large inequality. Understanding economic mobility is important because it shapes our perception of inequality. Despite its significance, evidence on intragenerational mobility, especially that based on administrative data, is relatively limited in developing countries. Using Thailand's tax return data, we study the evolution of earnings inequality, estimate medium-term earnings mobility, and examine the heterogeneity of mobility across age, gender and employment arrangement. Our analysis yields three main findings. First, annual earnings inequality rises during the 2009-2018 period. We find that the inequality is largely permanent, and its increase is primarily driven by top-earnings workers. Second, we find that medium-term mobility follows a U-shaped pattern across the earnings distribution, with extremely high persistence at the top. Our suggestive comparison indicates that Thailand's earnings mobility is among the lowest in the pool of evidence from both developed and developing countries. Third, there is a considerable heterogeneity in mobility regarding employment arrangement. Workers in less-formal jobs have much lower upward mobility than those in more-formal employment. Our findings also indicate significant heterogeneity in mobility with respect to gender and age. These findings highlight the importance of ensuring that any increase in inequality caused by the Covid-19 crisis does not become permanent, as well as improving access to opportunities for vulnerable workers.
Subjects: 
intragenerational earnings mobility
inequality
JEL: 
D31
D63
H20
J31
J60
Document Type: 
Working Paper
Appears in Collections:

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.