EFTA countries show decrease in income inequality

Published 18-07-2014
Income inequality, measured by the Gini coefficient, varies across Europe. Newly published data from Eurostat show that Norway and Slovenia had the lowest inequality among the EU and EFTA countries in 2012, whereas the highest inequality was found in Spain and Latvia. In both Iceland and Switzerland income inequality was below the EU28 average.

Between 2008 and 2012, income inequality decreased by 12% in Iceland. This was the largest decrease among the EU and EFTA countries. In Norway and Switzerland it fell by 10 and 7% respectively. In addition to the three EFTA States included in the analysis, income inequality decreased in 12 EU countries. One explanation for this is income losses in the upper part of the income distribution that happened during the financial and economic crisis.

In some countries, however, income inequality increased, most notably in Denmark where income inequality increased by 12% between 2008 and 2012.

In Iceland and Norway, people in the first quintile (the 20% with the lowest income) earned 10% of the total income in 2012, compared with 8% in the 28 EU countries. On average in the European Union, people in the fifth quintile (the 20% with the highest income) earned 39% of the total income in 2012.

The data show that from 2010 to 2011 at least 30% of people stayed in the same income decile in all countries. The lowest income mobility was found in Romania, where 60% stayed in the same decile, while the highest mobility was found in Iceland, where only 35% stayed in the same decile. Of those whose level of income changed in Iceland, 35% moved up at least one decile and 30% moved down at least one decile.

For more information, visit Eurostat's website. You can also read the publication as a PDF.

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