This report addresses growing concerns about income inequalities in academic and policy debates by offering a comprehensive study of income inequalities during the years of the Great Recession starting in 2008-2009 (income data relating to 2004-2013). It has the twofold objective of adopting an EU-wide perspective and providing an updated picture of inequalities across different sources of income and in most Member States. The results show that EU-wide income inequality declined notably prior to 2008, driven by a strong process of income convergence between European countries - but the Great Recession broke this trend and pushed inequalities upwards both for the EU as a whole and across most countries. While previous studies have pointed to widening wage differentials as the main driver behind the long-term trend towards growing household disposable income inequalities across many European countries, this report identifies unemployment and its associated decline in labour income as the main reason behind the inequality surges occurring in recent years. Real income levels have declined and the middle classes have been squeezed from the onset of the crisis across most European countries. The role played by the family pooling of income in reducing inequalities and the impact of European welfare policies in cushioning the effect of economic turbulences on the distribution of income are also explored.

Europe has become a dominant frame for the generation, regulation and perception of social inequalities. This trend was solidified by the current economic crisis, which is characterized by increasing inequalities between central and peripheral countries and groups. By analysing the double polarization between winners and losers of the crisis, the segmentation of labour markets and the perceived quality of life in Europe, this book contributes to a better understanding of patterns and dynamics of inequality in an integrated Europe.

'Who are the losers and the occasional winners in the current economic crisis? How have employers responded to the slump in economic growth? What lessons can be learned both from their and government labour policies? Daniel Vaughan-Whitehead, and a team of leading researchers address these questions applying the latest data and research including company case studies from across Europe, including Turkey and the transition economies. They observe some similarities, but also enormous differences. They find novel answers as the policies developed over the past two decades to foster greater flexibility have altered the way firms respond to market changes. Are all these changes socially desirable? The authors are to be congratulated for providing such a detailed panorama and frank assessment which will be of value to both academic and policy readers.' David Marsden, London School of Economics, UK 'Since the successive crises erupted the increase in inequality has not been addressed. This important publication offers a comprehensive overview of recent developments in the workplace. It will help to promote a different policy agenda that is desperately needed to overcome the causes and consequences of the crisis, namely addressing work inequalities.' Philippe Pochet, Catholic University of Louvain la Neuve, Belgium, and General Director of the European Trade Union Institute (ETUI), Brussels, Belgium Work Inequalities in the Crisis provides an in-depth overview of the effects of the crisis on inequalities in the world of work. It examines these inequalities multi-dimensionally, looking at employment, wages and incomes, working conditions and social dialogue. At the same time, it investigates whether the crisis may halt the progress made in Europe towards better quality jobs and working conditions. This book offers a unique combination of research, case studies and policy discussions. An assessment of national trends in 30 European countries precedes case studies of 14 of them, in which noted European specialists report on individual enterprises or sectors. The volume's survey of national- and local-level policy solutions contributes to identifying those responses that strengthen economic competitiveness, preserve social cohesion and do not deepen inequalities. This timely resource will be of particular interest to academics, students and researchers in labour economics, to policymakers, and to those involved in European studies more generally.

This book analyzes the interaction of European social models, the institutions structuring labor markets' supply side, and their turbulent macroeconomic environment from the deep Europe-wide recession, ending Germanys post-unification boom, through monetary union's establishment, to the Great Recession following the recent financial crisis. The analysis reaches two conclusions challenging the dominant view that the social models caused unemployment by impairing labor markets' efficiency in the name of equity. First, the social models' employment and distributive effects are far outweighed by their macroeconomic environment, especially in the Eurozone, where its truncated structure of economic governance transformed the Great Recession into a sovereign debt crisis. Second, instead of a trade-off between efficiency and equity, the employment effects of counteracting markets tendency to generate inequality depends on the macroeconomic conditions under which it occurs and how it is done.

European integration is focused on improving economic performance and increasing income levels in nations across the European Union. Political leaders and the media often use income trends to measure this progress, with inequality moving more and more to the forefront of these conversations. In this book, contributing authors focus on the economies within the EU, its member countries, and other European countries closely associated with the EU. The book includes an overview of economic and social trends, using long-term processes of European integration as a way to frame the discussions. Georg Fischer, Robert Strauss, and their contributors focus on explaining how policy makers and the media focus on national trends to measure progress among the nations in Europe. They make a specific point to look at the EU as an economic and political entity whose parts are closely interlinked rather than as a conglomerate of individual countries. The contributors consider the commonalities and differences between various institutions and policies, explaining how a decision in one country might impact another. Europe's Income, Wealth, Consumption, and Inequality offers a novel approach to the analysis of social and economic trends, and the resulting book identifies major policy challenges applicable in the EU and beyond.

While recent studies have highlighted the phenomenon and risks of increased inequalities between the top and the bottom of society, little research has so far been carried out on trends relating to the median income range that generally represents the middle class. This volume examines the following questions: what are the main transformations in the world of work over the last 20 years in terms of the labour market, social dialogue, and conditions of work, wages and incomes that may have affected the middle class? How has the middle class been altered by the financial and economic crisis? What are the long-term trends for the middle class in Europe?

This paper analyzes the extent of income inequality from a global perspective, its drivers, and what to do about it. The drivers of inequality vary widely amongst countries, with some common drivers being the skill premium associated with technical change and globalization, weakening protection for labor, and lack of financial inclusion in developing countries. We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down. This suggests that policies need to be country specific but should focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class. To tackle inequality, financial inclusion is imperative in emerging and developing countries while in advanced economies, policies should focus on raising human capital and skills and making tax systems more progressive.

Working-age individuals and their families have experienced increases in relative income poverty before the Great Recession (GR), and they have also seen significant income losses since the beginning of the downturn in 2007/8. This paper examines the effects of benefit and tax reforms on the distribution of incomes of non-elderly individuals in Europe and in the United States both before and after the GR. We aim to place recent policy responses in context of both the broader trends in redistribution patterns observed since the 1980s, and the immediate crisis-related challenges, including a much greater need for government support, and large and rapidly growing government debt. Analysis of historical household income data confirms the common finding that redistribution reduces income inequalities by much less in the US than in much of Europe. Since more redistributive tax-transfer systems tend to be more effective as a backstop to widening earnings gaps, redistribution in the US was also less effective at offsetting the substantial increase in the market-income inequality in the 2-3 decades leading up to the GR. Focussing on more recent policy changes, we then calculate income gains and losses that can be attributed to reforms shortly before and after the GR at different points in the earnings spectrum. The results show that a combination of discretionary and automatic policy changes in the US have significantly narrowed the pre-GR gap between the equalising capacities of US and European redistribution measures, and between their abilities to cushion the effects of economic shocks on household income. We argue, however, that this is unlikely to signify any longer-term convergence, and that Europe/US comparisons need to go beyond the common focus on differences in redistribution levels. In our view, an equally important question is how well redistribution measures respond and adapt to evolving social and fiscal challenges at different points in the economic cycle.