Baby booming inequality Demographic change and earnings inequality in Norway, 1967–2000Report as inadecuate

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The Journal of Economic Inequality

, Volume 9, Issue 4, pp 629–650

First Online: 12 February 2011Received: 01 February 2010Accepted: 20 January 2011


In this paper, we demonstrate how age-adjusted inequality measures can be used to evaluate whether changes in inequality over time are due to changes in the age-structure. To this end, we use administrative data on earnings for every male Norwegian over the period 1967–2000. We find that the substantial rise in earnings inequality over the 1980s and into the early 1990s, is to some extent driven by the fact that the large baby boom cohorts are approaching the peak of the age–earnings profile. We further demonstrate that the impact of age-adjustments on the trend in inequality during the period 1993–2000 is highly sensitive to the method used: While the most widely used age-adjusted inequality measure indicates little change in inequality over this period, a new and improved age-adjusted measure suggests a decline in inequality.

KeywordsInequality trend Age structure Age–earnings profile Gini coefficient Thanks to seminar participants at -Inequality: New Directions- at Cornell University and two anonymous referees for useful comments and suggestions. Financial support from the Norwegian Research Council 194339 is gratefully acknowledged. The project is part of the research activities at the ESOP center at the Department of Economics, University of Oslo. ESOP is supported by The Research Council of Norway.

Havnes also gratefully acknowledges support from the GRASP Collaborative Project EU-7FP, no. 244725.

JEL ClassificationD31 D63 D91 E21  Download to read the full article text

Author: Ingvild Almås - Tarjei Havnes - Magne Mogstad


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