Europe vs. the United States: is there a trade-off between mobility and inequality?

Abstract

The aim of this paper is to assess the possible relationships between individual income mobility and inequality in both the United States and selected European Union member states. The main hypotheses to be tested are the existence of notable differences in mobility between the United States and the European Union which could offset the observed differences in inequality, and the possible differences within the European Union. To this end, the principal approaches available to assess differences in mobility among countries have been reviewed and a wide range of indicators has been calculated. The elaboration of different indicators has allowed us to answer one of the questions that have dominated the debate regarding social models and equity. There are important differences among the countries selected. Most of the indicators present Italy and France as the countries with the highest and lowest mobility, respectively. Contrary to general belief, the United States is shown to have intermediate levels of mobility within an international context. Whatever the case, the most significant result is the absence of any clear relationship between inequality and mobility.