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Income Inequality in Some Major European Union Economies a Discriminant Analysis

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  • Jyotirmayee Kar

    (ICFAI Business School, Bhubaneswar, Orissa, India)

Abstract

This exercise is an attempt to assess the importance of some social, economic, demographic and infrastructural factors which account for the prevailing income inequality across some of the EU countries. Using discriminant analysis the study suggests that crime recorded by police is the most important predictor in discriminating between the group of countries with relatively more equitable distribution of income from those with less. This variable is followed by number of students in the country. Reduction in the level of crime and improvement in the student strength could help in reducing income inequality. Quite intuitively, improvement in all the economic factors like GDP per capita and agricultural index will help to reduce income inequality. Identical is the case of the demographic factors. This calls for implementation of developmental policies towards improvement in these areas.

Suggested Citation

  • Jyotirmayee Kar, 2012. "Income Inequality in Some Major European Union Economies a Discriminant Analysis," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 12(4), pages 117-128.
    • Handle: RePEc:pet:annals:v:12:y:2012:i:4:p:117-128
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    References listed on IDEAS

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    1. Andrés Rodríguez-Pose & Vassilis Tselios, 2009. "Mapping Regional Personal Income Distribution in Western Europe: Income Per Capita and Inequality," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 59(1), pages 41-70, January.
    2. Mr. Thomas Harjes, 2007. "Globalization and Income Inequality: A European Perspective," IMF Working Papers 2007/169, International Monetary Fund.
    3. Checchi, Daniele & Peragine, Vito & Serlenga, Laura, 2010. "Fair and Unfair Income Inequalities in Europe," IZA Discussion Papers 5025, Institute of Labor Economics (IZA).
    4. Martin Biewen, 2001. "Measuring the Effects of Socio-Economic Variables on the Income Distribution: An Application to the East German Transition Process," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 185-190, February.
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    More about this item

    Keywords

    income inequality; GDP per capita; EU countries;
    All these keywords.

    JEL classification:

    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions
    • E69 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Other
    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
    • O29 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Other
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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