What causes France’s income inequality?
Income inequality after redistribution is low in France relative to other OECD or euro-zone countries. In contrast, however, income inequality before redistribution is very high in France. What accounts for this high level of income inequality before redistribution in France, which requires large-scale redistributive policies? We look at: Overall income distribution between wages and earnings: it has remained very stable in France; The relative levels of wages, between low and high wages: the minimum wage has not declined relative to the median wage, the average wage, or the wages of the 1% or 10% highest income earners; The employment rate: it is well known that a low employment rate is associated with high income inequality before redistribution, and France’s employment rate is abnormally low. Altogether, reducing income inequality before redistribution in France would above all require an increase in the employment rate.