Determinants of Income Distribution in OECD Countries

The global economic crisis of 2008, which had begun in the US real estate market and then spread to Europe as a debt crisis, has rekindled the discussion of income distribution. The reasons that lie behind the increasing gap between the top 1 percent of income earners and the bottom 99 percent, and the issues of how this inequality to be solved have usually been at the center of the discussion. The purpose of this study is to identify factors affecting income distribution in OECD countries. In the first place, the researches that have analyzed income distribution within the OECD are taken. Data such as Gini coefficient, labor force participation rate, change in real labor income, P80/P20 ratio in OECD countries are interpreted thereafter. After the interpretation of the data, how income distribution in OECD countries interacts with factors such as age dependence, financialization, globalization, civil rights and labor income is discussed econometric approach with panel data analysis. The study concludes that while factors such as age dependency ratio, economic globalization, and financialization grow inequality, increasing labor income shares and civil rights enable fair distribution.