Tumen, Semih (2013): The impact of the 2008 crisis on top labor incomes in Turkey: A nonparametric analysis. Forthcoming in: Economics Bulletin
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Abstract
This paper presents a nonparametric analysis of the impact of the 2008 crisis on earnings distribution in Turkey. Using micro-level data from the Household Labor Force Survey (2004-2011), I show that the crisis has operated most visibly above the upper quartile of the earnings distribution. I present three main findings: (1) the share of the top decile -- especially the top percentile -- has increased significantly right after the crisis, (2) the top quartile (i.e., the right tail) of labor incomes in Turkey resembles, on average, a Pareto distribution with a corresponding Gini coefficient of around 0.23, and (3) following the crisis, the earnings differentials have widened above the top quartile and wildly deviated from the Pareto form. I document that the changes observed right after the crisis have mostly been temporary; that is, a normalization process has operated in the aftermath of the crisis. I argue that the health of the domestic banking system might be an important determinant of the effect of large scale financial crises on top labor incomes. A sound banking system can generate income polarization in a country, when global crises lead to asymmetric income reallocations across sectors.
Item Type: | MPRA Paper |
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Original Title: | The impact of the 2008 crisis on top labor incomes in Turkey: A nonparametric analysis |
Language: | English |
Keywords: | Earnings differentials; inequality; the 2008 crisis; Turkish Household Labor Force Survey. |
Subjects: | C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C14 - Semiparametric and Nonparametric Methods: General D - Microeconomics > D3 - Distribution > D33 - Factor Income Distribution J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure ; Wage Differentials |
Item ID: | 47112 |
Depositing User: | Semih Tumen |
Date Deposited: | 21 May 2013 18:17 |
Last Modified: | 28 Sep 2019 16:48 |
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URI: | https://mpra.ub.uni-muenchen.de/id/eprint/47112 |