The Economic Crisis, Public Sector Pay, and the Income Distribution

Date: 01 June 2011

An important aspect of the impact of the economic crisis is how pay in the public sector responds – in the face not only of the evolution of pay in the private sector but also extreme pressure on public spending (of which pay is a very large proportion) as fiscal deficits soar. What are the effects on the income distribution of cutting public sector pay rates or alternative strategies to reduce the public sector pay bill? This chapter investigates these issues using data and a tax–benefit simulation model for Ireland, a country which faces a particularly severe fiscal crisis and where innovative measures have already been implemented to claw back pay from public sector workers in the guise of a ‘pension levy’, followed by a significant cut in nominal pay rates.

Brian Nolan Tim Callan John R Walsh

Employment, Equity and Growth

The Economic Crisis, Public Sector Pay, and the Income Distribution


Type: book

ISBN: 978-0-85724-749-0

Callan, T., Nolan, B. and Walsh, J. (2011) 'The Economic Crisis, Public Sector Pay, and the Income Distribution'. in Immervoll, H., Peichl, A. and Tatsiramos, K. (eds.) "Who Loses in the Downturn? Economic Crisis, Employment and Income Distribution" (Research on Labor Economics. Vol 32) Emerald Group Publishing Limited. pp.207-225.


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