While there have been studies on the long-run evolution of income inequality in the Nordics (Aaberge and Bengtsson, 2023; Iacono and Palagi, 2020), there is still a need for more comprehensive analyses that cover the most recent years and consider the impact of recent economic and social policies. Moreover, there is a need for better understanding of the influence of the demographic makeup, including migration (Pareliussen and Robling, 2018) and gender intersections (Boschini and Gunnarsson, 2018), as well as income composition and the evolving role of taxation and welfare policies (Søgaard and Egholt, 2018). Additionally, there is a need for more detailed studies on regional disparities and comparative analyses with other regions (Iacono and Palagi, 2020).
This paper presents empirical evidence on the development of income inequalities in the Nordic countries and self-governing territories during the first decades of the 21st century (2005-2022). The analysis focuses on the social and territorial expressions of socio-economic inequalities, considering income differentials within and between territorial units. The exploration builds on data collected at the municipal level in Åland, Denmark, Finland, Greenland, Norway and Sweden, at the regional level in the Faroe Islands and for Statistical Output Areas in Iceland.
Our analysis pays particular attention to the development of household income in rural and urban areas since the pre-2007 financial crisis. We also aim to shed light on the relationship between average income levels and living standards in the various municipalities, as well as their respective levels of income inequality. We are interested in understanding whether those two dimensions reinforce each other, meaning that greater levels of affluence lead to greater levels of inequality. Last but not least, we also explore the contribution of income inequalities within and between municipalities to inequality at societal level.