Merz: The Distribution of Income of Self-employed, Entrepreneurs and Professions
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7 Results II: The Income Distribution of Single Professions
After having discussed the distributional picture for the employees and self-employed
we are now going into more details: we analyze the distribution of professions and their
subgroups. Professions are of interest in particular for several reasons: they are
satisfying important goods like health or justice and they are an important factor of the
service industry in general. In addition to the substantial reasons: although from the
beginning of the 50s in Germany the absolute amount of self-employed has decreased,
the number of professions and the relative importance of professions within the group of
self-employed has even increased all over the last decades. This is reflecting the
growing importance of the service industry in general and a growing important
contribution of the professions. For a further discussion of the size, structure and
general importance of the professions in the society e.g. see Merz, Rauberger and
Ronnau (1994) and the literature cited there.
Our contribution to the professions' discussion and the question to be answered here is:
is there a typical income distribution of 'the' professions showing more or less
homogeneous concentration on higher income? In either cases, what can be said about
the income inequality of single groups of professions and their contribution to the
overall income distribution?.
As stated in the introduction, this is the first time for Germany to be able to answer
these questions based on such a rich database and in particular on anonymized
microdata. As above, we divide our analysis into three steps: we measure the inequality
situation, analyze the redistributional effect of the German tax system and investigate
the overall professions' income distribution by the decompostion of inequality for single
subgroups of professions.
Official Federal Statistical Office (1998) income tax publications deliver 14 selected
subgroups of professions as provided by all the grouped table information. Though
selected, the 14 subgroups nevertheless covers the complete picture of the professions
(with their rest category 'other' professions).
To allow further comparisons between our microdata sample results and the grouped
total population results we continue with these 14 subgroups of professions when
analyzing the situation based on the sample microdata. Because of the very nature of the
microdata, of course further single and specific professions can be regarded, but need
additional computations within the Federal Statistical Office.
We analyze professions defined by the predominant income concept. Again, the
microdata sample, too, covers all professions summarized in the before mentioned 14
subgroups. Since professions with 1,85% (1992 population) build a relatively small
group in the population, even in a large micro sample the absolute amount of persons
regarded is expected to be relatively small. Thus, for valid results the more it is
important that the sample structure is similar to the population structure. Table A2 in the
Appendix compares the unweighted and weighted sample structure of single professions
with the actual population structure in Germany 1992. The overall result: our sample
fits the actual professions’ structure pretty good: all single subgroup percentage
differences are less than 1 percentage point besides of the 1,07 percentage point
difference of artistic professions. With the details of Table A2 we have a valid