Within and between sectoral sources of wage inequality across European Union countries
Within and between sectoral sources of wage inequality across European Union countries

Summary/Abstract: The paper presents results of research about wage inequality across European Union member states. It aims at specifying the importance of sectoral features of the countries as a source of differentiation in a level of remunerations. To achieve this goal Theil index concerning the average wages and salaries per employee in EU members was calculated. Its disaggregation into within and between sectoral components enabled to conclude about the importance of structural pattern of development for wage differentiation. The analysis proved that sectoral characteristics are responsible for about 1/3 of the wage inequality across EU countries. However, the most important source of the differentiation is a general level of socio-economic development. Moreover, considering changes in a level of wage inequality in the period 2004-2013 there was drawn a conclusion about a convergence of remunerations in EU induced mainly by equalization of the general level of development. Thus the importance of structural features as a source of inequality has grown. The research also allowed to indicate the most modern branches as the ones with the lowest level of wage inequality across EU countries. More traditional kinds of activity, primarily agriculture, were experiencing the highest level of differentiation in remunerations in the whole period of the analysis.

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