Income Inequality in the Republic of Ireland (2004-2015)

Income Inequality in the Republic of Ireland (2004-2015)



Ciarán Nugent


This paper provides a descriptive overview of the distribution of market income (income from market sources), gross income (income from all sources before taxes) and disposable income (income after taxes) in the Republic of Ireland between 2004 and 2015. Rather than households (the more common unit of analysis in the literature), this analysis focusses on taxpayer units, also known as income cases, building on and adding to recent work on Irish income distribution from both perspectives. The paper continues with analysis of income inequality using various indicators prevalent in the literature including Gini coefficients, percentile ratios and top and bottom inequality measures. Although the Gini coefficient, a summary measure and the most common income inequality indicator in the literature, was relatively stable in gross and disposable income terms between 2004 and 2015 (in line with findings in several recent publications), a more detailed examination of the data shows widening income inequality between groups at different points in the income distribution over time. Significantly, the gap between the bottom (income at the 10th percentile) and the middle point of the distribution (median income) was wider in 2015 relative to the years pre-crisis. This is also the case between the bottom and the top (income at the 90th percentile) of the distribution. The gap between the middle point in the distribution and the top was virtually unchanged over the same period. These trends apply to both gross and disposable income.

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