Education And Income Inequality In The Regions Of The European Union

This paper provides an empirical study of the determinants of income inequality across regions of the EU. Using the European Community Household Panel dataset for 102 regions over the period 1995-2000, it analyses how microeconomic changes in human capital distribution affect income inequality for the population as a whole and for normally working people. The different static and dynamic panel data analyses conducted reveals that, while the relationship between income inequality and income per capita is positive, the relationship between income inequality and educational attainment is not clear. Across European regions high levels of inequality in educational attainment are associated with higher income inequality.