Lifetime earnings inequality in Germany

Arbeitspapier

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.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: DIW Discussion Papers ; No. 1160

Classification and Topics

• Classification: Wirtschaft ; Personal Income, Wealth, and Their Distributions ; Factor Income Distribution ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
• Subject: Lifetime Earnings ; Earnings Distribution ; Inequality ; Mobility ; Germany ; Lebenseinkommen ; Lohn ; Lebensverlauf ; Einkommensverteilung ; Soziale Ungleichheit ; Deutschland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bönke, Timm ; Corneo, Giacomo ; Lüthen, Holger
• Event: Veröffentlichung
• (who): Deutsches Institut für Wirtschaftsforschung (DIW)
• (where): Berlin
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/61316
• Last update: 10.03.2025, 11:42 AM CET