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The distribution and re-distribution of income of selfemployed as freelancers and entrepreneurs in Europe

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  • Merz, Joachim
  • Hirschel, Dierk

Abstract

The economic transformations of modern industrial societies have changed the labor markets in terms of industrial relations and occupational structure. The transformation of the traditional welfare state, the deregulation of the labor markets, the technological change and the reorganization of industrial structures influenced strongly the attitude of individuals towards their preferred labor contract. The structural change of the occupational structure was one of the results of this tendency. In particular the self-employed and freelancers have been affected and are a driving factor of labor market changings. On the one side the value of autonomy regarding industrial relations is becoming more important for employees. On the other side employers want to get rid of social security contributions. As a result the multitudinousness of these professions increased. The increasing varieties of occupations among the self-employed and freelancers influenced strongly their income distribution. Recent studies for Germany have shown a great dispersion and a heterogeneous structure of earnings in particular of freelancers (liberal professions) and self-employed. Though there are a variety of international income distribution studies, but – as to the best to our knowledge – no study focusing on the selfemployed and freelancers within the total labor force. In our study we concentrate on the income distribution of self-employed and freelancers in different European countries. Based on the Luxembourg Income Study (LIS) we analyze five different European countries and the United States structured by different types of welfare states according to Esping Anderson. We analyze income distributional aspects, an occupational decomposition à la Shorrocks, and re-distributional effects of the tax and transfer systems.

Suggested Citation

  • Merz, Joachim & Hirschel, Dierk, 2003. "The distribution and re-distribution of income of selfemployed as freelancers and entrepreneurs in Europe," MPRA Paper 5981, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:5981
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    References listed on IDEAS

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    More about this item

    Keywords

    Europe; Income distribution of freelancers and self-employed; decomposition of inequality; redistribution; LIS microdata;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General

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