The Great Recession and the Distribution of Household Income

The so-called Great Recession that followed the global financial crisis at the end of 2007 was the largest economic downturn since the 1930s for most rich countries. To what extent were household incomes affected by this event, and how did the effects differ across countries? This is the first cross-national study of the impact of the Great Recession on the distribution of household incomes. Looking at real income levels, poverty rates, and income inequality, it focusses on the period 2007-9, but also considers longer-term impacts. Three vital contributions are made. First, the book reviews lessons from the past about the relationships between macroeconomic change and the household income distribution. Second, it considers the experience of 21 rich OECD member countries drawing on a mixture of national accounts, and labour force and household survey data. Third, the book presents case-study evidence for six countries: Germany, Ireland, Italy, Sweden, the UK, and the USA. The book shows that, between 2007 and 2009, government support through the tax and benefit system provided a cushion against the downturn, and household income distributions did not change much. But, after 2009, there is likely to be much greater change in incomes as a result of the fiscal consolidation measures that are being put into place to address the structural deficits accompanying the recession. The book's main policy lesson is that stabilisation of the household income distribution in the face of macroeconomic turbulence is an achievable policy goal, at least in the short-term.

Auteur

Stephen P. Jenkins is Professor of Economic and Social Policy at the London School of Economics, and a former Director of the Institute for Social and Economic Research at the University of Essex where he is now Visiting Professor. He has served as Chair of the Council of the International Association for Research on Income and Wealth, and as President of the European Society for Population Economics. He is a Research Professor at DIW Berlin, and a Research Fellow of IZA Bonn, and was a member of the UK's National Equality Panel that reported in 2010. His research interests are in topics related to the distribution of income, the labour market, and the tax-benefit system. He is the author of Changing Fortunes: Income Mobility and Poverty Dynamics in Britain, OUP, 2011, and co-edited Inequality and Poverty Re-Examined, OUP, 2007 (with John Micklewright), and The Dynamics of Child Poverty in Industrialised Countries, Cambridge University Press, 2001 (with Bruce Bradbury and John Micklewright). Andrea Brandolini is an economist in the Economic Structure and Labour Market Division of the research department of the Bank of Italy. He has served as Chair of the Council of the International Association for Research on Income and Wealth. He was a member of the executive committee of the Luxembourg Income Study. He chaired the Italian statistical office's Commission for the revision of absolute poverty measurement, and was a member of the Poverty Commissions established by Italian governments from 1994 to 2007. He is associate editor of the Journal of Economic Inequality. His research interests are income and wealth distribution, poverty and social exclusion, measurement of economic well-being, labour economics. He co-edited Povertà e benessere (Il Mulino, 2007, with Chiara Saraceno) and Dimensioni della disuguaglianza in Italia: povertà, salute, abitazione (Il Mulino, 2009, with Chiara Saraceno and Antonio Schizzerotto). John Micklewright is Professor of Economics and Social Statistics at the Institute of Education, University of London. He was previously Professor of Social Statistics at the University of Southampton, Professor of Economics at Queen Mary, University of London, and at the European University Institute, Florence, and Head of Research at the UNICEF Innocenti Research Centre. He is a Research Fellow of IZA, Bonn, and CEPR, London. His research addresses various issues relating to the distribution of income, the labour market, child outcomes, educational achievement, charitable giving, and survey methods. He co-authored Economic Transformation in Eastern Europe and the Distribution of Income (Cambridge University Press, 1992, with Tony Atkinson) and co-edited The Dynamics of Child Poverty in Industrialised Countries (Cambridge University Press, 2001, with Bruce Bradbury and Stephen Jenkins) and Inequality and Poverty Re-Examined (OUP, 2007, with Stephen Jenkins). Brian Nolan has been Professor of Public Policy in UCD's School of Applied Social Science since 2007, and Principal of UCD's College of Human Sciences since September 2011. He was previously at the Economic and Social Research Institute and the Central Bank of Ireland. He has a BA in Economics and History from UCD, an MA in Economics from McMaster University (Ontario), and a doctorate in economics from the London School of Economics and Political Science. His main areas of research are poverty, income inequality, the economics of social policy, and health economics. Recent publications include studies on social inclusion in the EU, top income shares, child poverty, deprivation and multiple disadvantage, tax and welfare reform, and the distributional impact of the economic crisis. He co-edited The Handbook of Economic Inequality (OUP 2009), and co-authored Poverty and Deprivation in Europe with Christopher T. Whelan (OUP 2011).