No. 496 - The distribution of wellbeing among Europeans

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by Andrea Brandolini and Alfonso Rosolia April 2019

We study the evolution of the EU income distribution, considering the EU as a single country. This is more in line with the spirit of the integration process than the standard practice of obtaining EU distributional statistics by averaging national ones. This European perspective highlights synergies and trade-offs between EU economic policies that foster integration by pursuing macroeconomic stability and convergence and EU social policies whose implementation, constrained by the economic ones, is left to member states.

Individual well-being increased during the integration process and differences between the mean incomes of member states declined, at least until the mid-2000s. EU15-wide income inequality clearly declined until the 1980s; the economic turmoil around 2010 pushed inequality up, mainly because of the divergence between the core and periphery countries of the EA. EU28-wide inequality has instead continued to decline, driven by the macroeconomic convergence of new EU-accession countries.

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