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Labor Earnings And Household Income Mobility In Reunified Germany: A Comparison Of The Eastern And Western States

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  • Richard Hauser
  • Holger Fabig

Abstract

Using data from the German Socio‐Economic Panel, we compare income mobility of persons from the eastern and western states of Germany between 1990 and 1995. We consider income mobility between consecutive years and between the first and the final year of this time period. We find that gross individual labor income mobility was much higher in the east than in the west during the first years after reunification, but that this difference has become much smaller until 1995. Changing to measures that reflect economic well‐being more accurately, we observe that gross equivalent labor income mobility and net equivalent income mobility initially were also much higher in the eastern states than in the western states, but converged over time as well. This convergence has been particularly strong for net equivalent income mobility, suggesting that the social protection system has greatly reduced mobility risks associated with the transformation process in the eastern states of Germany.

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  • Richard Hauser & Holger Fabig, 1999. "Labor Earnings And Household Income Mobility In Reunified Germany: A Comparison Of The Eastern And Western States," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 45(3), pages 303-324, September.
    • Handle: RePEc:bla:revinw:v:45:y:1999:i:3:p:303-324
    DOI: 10.1111/j.1475-4991.1999.tb00342.x
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    Cited by:

    1. Riphahn, Regina T. & Schnitzlein, Daniel D., 2016. "Wage mobility in East and West Germany," Labour Economics, Elsevier, vol. 39(C), pages 11-34.
    2. Buscher, Herbert S. & Parys, Juliane, 2006. "Prekäre Einkommenslagen in Deutschland: Ein Ost-West-Vergleich 1996 bis 2002," IWH Discussion Papers 2/2006, Halle Institute for Economic Research (IWH).
    3. Johannes Gernandt & Friedhelm Pfeiffer, 2008. "Wage Convergence and Inequality after Unification: (East) Germany in Transition," SOEPpapers on Multidisciplinary Panel Data Research 107, DIW Berlin, The German Socio-Economic Panel (SOEP).
    4. KUHL Karol, 2003. "Income mobility, unemployment and GDP," IRISS Working Paper Series 2003-01, IRISS at CEPS/INSTEAD.
    5. Gernandt, Johannes, 2009. "Decreasing wage mobility in Germany," ZEW Discussion Papers 09-044, ZEW - Leibniz Centre for European Economic Research.
    6. David Cantarero & Marta Pascual, 2005. "Regional Differences In Health In Spain - An Empirical Analysis," ERSA conference papers ersa05p551, European Regional Science Association.
    7. Hyungna Oh & Yun Jeong Choi, 2018. "Limited Income Mobility: Empirical Evidence from Korea," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 138(2), pages 665-687, July.
    8. Beblo, Miriam & Collier, Irwin L. & Knaus, Thomas, 2001. "The unification bonus (malus) in postwall Eastern Germany," ZEW Discussion Papers 01-29, ZEW - Leibniz Centre for European Economic Research.
    9. Wolfgang Franz & Viktor Steiner, 2000. "Wages in the East German Transition Process: Facts and Explanations," German Economic Review, Verein für Socialpolitik, vol. 1(3), pages 241-269, August.

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