Inequality in Five Countries in the 1980s: The Role of Demographic Shifts, Markets and Government Policies

Abstract

This paper uses Luxembourg Income Study (LIS) data to examine levels of and trends in income inequality in Canada, the Netherlands, Sweden, the United Kingdom and the United States. Inequality increased in Sweden, the United Kingdom and the United States but did not increase in Canada and the Netherlands. Increased inequality of household head’s earnings and increased shares of spouse’s earnings in family income account for much of the observed increases in income inequality. The public sector can, in general, be assigned a moderating effect on these changes. Demographic shifts are not assigned any major role in inequality changes.