Search results
1 – 10 of over 18000João Sousa Andrade, Adelaide Duarte and Marta C.N. Simões
The purpose of this paper is to examine the distributions of earnings and education in Portugal in the early years of European integration, 1985 and 1991, a period when Portugal…
Abstract
Purpose
The purpose of this paper is to examine the distributions of earnings and education in Portugal in the early years of European integration, 1985 and 1991, a period when Portugal experienced strong nominal convergence following EU accession.
Design/methodology/approach
The paper explores the information provided by relative distribution analysis and covariate (education) decomposition to study the dynamics of the earnings distribution since these methodologies allow for the identification of polarization patterns that might have occurred over the period. More standard methodological instruments are also used as a reference: cardinal measures of inequality and the Lorenz stochastic dominance approach.
Findings
The median and average earnings of employees increased and there was also a rise in earnings inequality. Relative to 1985, in 1991 there were more employees with very low earnings but also more 1991 employees with high earnings and there were also more employees at the bottom and top ends of the earnings distribution. The analysis of the relative earnings distribution by level of education reveals substantial differences for the top end of the distributions with the proportion of 1991 employees receiving the highest earnings higher than for the original 1985 cohort. A regional disaggregation confirms that the overall employees’ earnings and education distributions characteristics are determined by the behaviour of coastal regions, while in the non-coastal regions a lower level of inequality is associated with lower levels of median and average earnings and a different polarization pattern.
Originality/value
The paper shows that inequality is not a recent phenomenon in the Portuguese economy and thus might be one of the sources of the growth slowdown Portugal is experiencing since the turn of the century and might continue to hamper growth in the future deserving deeper investigation.
Details
Keywords
Francesco Andreoli, Arnaud Lefranc and Vincenzo Prete
Educational policies are widely recognized as the means par excellence to equalize opportunities among children with different social and family backgrounds and to promote…
Abstract
Educational policies are widely recognized as the means par excellence to equalize opportunities among children with different social and family backgrounds and to promote intergenerational mobility. In this chapter, we focus on the French case and we apply the opportunity equalization criterion proposed by Andreoli, Havnes, and Lefranc (2019) for evaluating the effect of rising compulsory schooling requirements in secondary education. Our results show that such education expansion has a limited redistributive effect on students’ earnings distribution. Nonetheless, we provide evidence of opportunity equalization among groups of students defined by family background circumstances.
Details
Keywords
Stavros Degiannakis, George Giannopoulos, Salma Ibrahim and Bjørn N. Jørgensen
The authors propose an alternative robust technique to test for discontinuities in distributions and provide consistent evidence of discontinuities around zero for both scaled and…
Abstract
Purpose
The authors propose an alternative robust technique to test for discontinuities in distributions and provide consistent evidence of discontinuities around zero for both scaled and unscaled earnings levels and changes. The advantage of the proposed test is that it does not rely on arbitrary choice of bin width choices.
Design/methodology/approach
To evaluate the power of the test, the authors examine the density function of non-discretionary earnings and detect no evidence of discontinuities around zero in levels and changes of these non-discretionary earnings. As robustness, the authors use pre-managed earnings excluding accrual and real manipulation and find similar evidence.
Findings
The finding using our technique support the Burgstahler and Dichev (1997) interpretation on earnings management, even for smaller sample sizes and reject the theory that discontinuities arise from scaling and sampling methods.
Originality/value
The study provides an overview of those studies that support and those that oppose using “testing for discontinuities” as a way to examine earnings management. The authors advance the literature by providing an alternative methodology supporting the view that the kink in the distribution represents earnings management.
Details
Keywords
Vera Adamchik, Thomas Hyclak and Arthur King
Analyzes the wage structure and wage distribution for male and female Polish workers during a more mature phase of a transition to a market economy, namely 1994‐2001. The results…
Abstract
Analyzes the wage structure and wage distribution for male and female Polish workers during a more mature phase of a transition to a market economy, namely 1994‐2001. The results indicate an overall rise in earnings inequality for both genders during this period. Contrary to conventional expectations, changes in the composition of employment caused by a deep restructuring process did not have a significant impact on earnings inequality. Throughout this period, the changes in the wage structure and wage distribution were almost entirely due to the changes in returns to worker characteristics. However, does not observe the “explosion of differentials at all levels,” predicted by many leading models on transition. Wage structures for men and women evolved in different ways. This analysis suggests that the effect of changes in labor supply and institutional factors on the wage structure and wage distribution was relatively unimportant. Demand side factors seem to be far more important in explaining the dynamics of earnings inequality in Poland during 1994‐2001.
Details
Keywords
Mats Hammarstedt and Ghazi Shukur
There is now a large amount of literature on immigrants' relative earnings and immigrants' earnings assimilation in different countries. This paper aims to contribute to…
Abstract
Purpose
There is now a large amount of literature on immigrants' relative earnings and immigrants' earnings assimilation in different countries. This paper aims to contribute to international research, since the paper investigates the earnings gap between different groups of immigrants and natives at different parts of the earnings distribution in Sweden.
Design/methodology/approach
Quantile regressions are estimated on a large dataset in order to study to what extent there are differences in the earnings gap between different groups of immigrants and natives at the top and the bottom of the earnings distribution in Sweden.
Findings
The study shows, that immigrants are doing relatively better at the top than at the bottom of the earnings distribution. This is the case for males as well as for females. Furthermore, the study also shows that in times of recession, the earnings gap between immigrants from European countries and natives remains stable, while the earnings gap between non‐European immigrants and natives at the bottom of the earnings distribution increases substantially.
Originality/value
This paper is useful to those wishing to examine the extent of differences in earnings between immigrants and natives and differences in earnings between different immigrant groups.
Details
Keywords
Francieli Tonet Maciel and Ana Maria Hermeto C. Oliveira
The purpose of this paper is to examine the effects of changes in the relative composition and in the segmentation between formal and informal labour on earnings differentials…
Abstract
Purpose
The purpose of this paper is to examine the effects of changes in the relative composition and in the segmentation between formal and informal labour on earnings differentials among women over the last decade in Brazil.
Design/methodology/approach
The authors follow Machado and Mata’s method to decompose the changes along the earnings distribution, with correction for sample selection and using microdata from the Demographic Census of 2000 and 2010. Informal labour was divided into informal salaried labour and self-employment, and both groups were compared with the formal labour separately.
Findings
The results indicate that, in both cases, an increase in earnings differentials in the bottom of the earnings distribution due to segmentation, suggesting that the returns to formal labour have grown relatively to informal labour during the period. On the other hand, earnings differentials decrease as one moves up the earnings distribution due to the composition effect, which is stronger on the top of the distribution relatively to the bottom. Furthermore, there are compensating differentials for self-employed women above the 30th quantile, which contributed to reduce the inequality between this group and formal workers.
Originality/value
The paper contributes to a better understanding of the changes taking place in female labour, shedding some light on how they affect different points along the earnings distribution. Furthermore, the adopted approach proposes a new application for the correction of sample bias in the context of quantile regression by employing a logit multinomial, and using the Demographic Census data.
Details
Keywords
D.J. SLOTTJE and MICHAEL NIESWIADOMY
The lack of a satisfactory theory of personal income distribution is a problem that economists have pondered for most of the twentieth century. In 1912 Irving Fisher wrote:
Francesco Bloise, Maurizio Franzini and Michele Raitano
The authors analyse how the association between parental background and adult children's earnings changes when net rather than gross children's earnings are considered and…
Abstract
Purpose
The authors analyse how the association between parental background and adult children's earnings changes when net rather than gross children's earnings are considered and disentangle what such changes depend on: differences between pre and after taxes earnings inequality or reranking of individuals along the earnings distribution before and after taxes.
Design/methodology/approach
Using data from European Union Statistics on Income and Living Conditions (EU-SILC) 2011, the authors focus on two large European countries, Italy and Poland, with comparable levels of inequality and background-related earnings premia but very different personal income tax (PIT) design and estimate – at both the mean and the deciles of the earnings distribution – the association between parents' characteristics and children's gross and net earnings.
Findings
The authors find that in Italy the PIT reduces the magnitude of the association between parental background and adult children's earnings at the top of the distribution, while no effects emerge for Poland, and the reduction is mostly due to a decrease in earnings inequality rather than to a re-ranking of children along the distribution. The findings are confirmed when the authors simulate the introduction of a “quasi flat tax” regime in Italy.
Social implications
The findings suggest that the higher the tax progressivity, the higher the background-related inequality reduction and the lower the intergenerational association, signalling that the degree of progressivity amongst children may be an effective weapon to reduce intergenerational inequality.
Originality/value
In the literature on intergenerational inequality, the role of taxes is usually overlooked. In this paper, the authors try to fill this gap and enquire how the PIT design affects the association between parental background and adult children's earnings.
Details
Keywords
Roberta Adami, Orla Gough and Angeliki Theophilopoulou
The purpose of this paper is to investigate how changes in the distribution of pre retirement labour earnings affect post‐retirement income in the UK.
Abstract
Purpose
The purpose of this paper is to investigate how changes in the distribution of pre retirement labour earnings affect post‐retirement income in the UK.
Design/methodology/approach
The authors estimate a PROBIT model and perform a counterfactual simulation to assess the effects of changes in the earnings distributions on pensions in the UK. The paper uses data from the British Household Panel Survey (BHPS).
Findings
The distribution of labour earnings before retirement plays a considerable role in the pension distribution of current retirees, particularly for low and medium incomes in the period 1991‐2007 for the UK. Improvements in Social Security have lifted many out of poverty; however there is still a gender gap as it is found that the current system of public and private schemes has not substantially improved pension income dispersion among women. On the other hand, changes in labour earning distributions have benefited more poor female pensioners than male.
Originality/value
The paper uses BHPS data, which is a longitudinal panel of survey questions made to UK households between 1991 and 2007. The level of detail of such data allows the study of the complete distributions of pre and post retirement income rather than focussing only on some measures of dispersion.
Details
Keywords
The purpose of this paper is to examine whether Egyptian listed firms engage in earnings management to meet or beat earnings thresholds, particularly, earnings level (avoiding…
Abstract
Purpose
The purpose of this paper is to examine whether Egyptian listed firms engage in earnings management to meet or beat earnings thresholds, particularly, earnings level (avoiding losses) threshold and earnings change (avoiding earnings decreases) threshold.
Design/methodology/approach
The paper uses the distribution of reported earnings approach, similar to Burgstahler and Dichev, to examine discontinuities around earnings thresholds as evidence on earnings management to meet or beat earnings thresholds.
Findings
The research findings reveal that there is a discontinuity in the distribution of reported earnings and earnings changes of Egyptian listed firms surrounding zero. There are too few observations immediately below zero and too many observations immediately above zero. These results suggest that Egyptian listed firms tend to engage in earnings management to avoid reporting losses and avoid reporting earnings decreases.
Research limitations/implications
The paper's main limitation is the relatively small sample size given the thinness of the Egyptian capital market, therefore, the findings should be interpreted with caution.
Originality/value
The paper contributes to the literature by examining earnings management to meet or beat earnings thresholds in Egypt as one of the emerging markets.
Details