Income Distribution and Income Mobility - Recent Trends in Sweden

Sweden is often viewed as a country with long-term widening gaps in the distribution of equivalent disposable income. In the first part of this paper we present recent data on income distribution trends that show only a small increase in the 1990s, in spite of economic crises and persistent high unemployment. In our examination, we eliminate various peculiarities in the Swedish data that often are disregarded in international comparisons. In the second part we present arecent study on mobility of equivalent disposable income. The proportion of people moving from the group with a low economic standard to the medium-income group appears to have remained at a relatively high level even during the financial crisis of the 1990s. Total mobility has decreased somewhat during the 1990s compared with earlier years. This is probably explained by the fact that incomes are measured more accurately since the tax reform in 1990-1991. The second part of the paper is based in part on the Govemment Income Distribution Report presented in the Budget Bill 1998.