Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/61316
Authors: 
Bönke, Timm
Corneo, Giacomo
Lüthen, Holger
Year of Publication: 
2011
Series/Report no.: 
DIW Discussion Papers 1160
Abstract: 
This paper documents the magnitude, pattern, and evolution of lifetime earnings inequality in Germany. Based on a large sample of earning biographies from social security records, we show that the intra-generational distribution of lifetime earnings of male workers has a Gini coefficient around .2 for cohorts born in the late 1930s and early 1940s; this amounts to about 2/3 of the value of the Gini coefficient of annual earnings. Within cohorts, mobility in the distribution of yearly earnings is substantial at the beginning of the lifecycle, decreases after-wards and virtually vanishes after age forty. Earnings data for thirty-one cohorts reveals striking evidence of a secular rise of intra-generational inequality in lifetime earnings: West-German men born in the early 1960s are likely to experience about 80 % more lifetime inequality than their fathers. In contrast, both short-term and long-term intra-generational mobility have been rather stable. Longer unemployment spells of workers at the bottom of the distribution of younger cohorts contribute to explain 30 to 40 % of the overall increase in life-time earnings inequality.
Subjects: 
Lifetime Earnings
Earnings Distribution
Inequality
Mobility
Germany
JEL: 
D31
D33
H24
Document Type: 
Working Paper

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