Income developments in the great recession

Status for the Danish prime-age working population a decade following the onset of the Financial Crisis

Dados Bibliográficos

ID12836668
AutoresMads Lybech Christensen (VIVE - The Danish Center for Social Science Research, autor correspondente), Anders Bruun Jonassen (Rockwool Foundation), P Fallesen (0000-0003-0544-9977, Stockholm University)
Ano2023
Volume22
Fascículo2
Páginas237-264
Data de publicação2023-09-08
Peer ReviewedSim
Open AccessSim
TipoARTICLE
PeriódicoThe Journal of Economic Inequality (JOURNAL)
Identificadores do periódicoISSN: 1569-1721 • E-ISSN: 1573-8701
EditoraSpringer Science+Business Media (PUBLISHER • DE)
DOI10.1007/s10888-023-09591-9
OpenAlexW4386545687
IdiomaEN
Citações recebidas1
Referências citadas15

To assess the impact of the Financial Crisis and the Great Recession in Denmark this paper studies developments in Danish labor market income and disposable income from 1995 through 2019. We focus on the prime age working population of 25–54-year-old Danish citizens, with emphasis on labor market performance of the younger and less educated members of this labor force. The recession had a large and long-lasting impact on labor market earnings. Young individuals and, especially, those with least education suffered the largest setbacks to earnings developments. Disposable income was not affected in a similar way. Welfare state transfers and lower taxes softened the impact on disposable income, while the unprecedentedly low lending-rates and tax reform also elevated consumption possibilities. Tracking economic activity of the youngest cohorts after the onset of the Financial Crisis we find that catching up to earnings levels of previous cohorts took on average 8 years. For young men the setback to earnings was larger and catching-up slower. A decade following the onset of the Financial Crisis around 20% of young men, pertaining to the bottom of the earnings distribution, had still not caught up to the earnings of previous cohorts

Danish · Demographic economics · Development economics · Economic policy · Economics · Financial crisis · Great recession · Keynesian economics · Labour economics · Population · Prime (order theory · Recession · Sociology · Working population · Demography · Economic Theory and Policy · Financial Literacy, Pension, Retirement Analysis · Housing, Finance, and Neoliberalism