6. Summary and conclusions
This paper outlines an approach that seeks to problematize and probe the ways in which entrepreneurship may contribute to income inequality. Using recently developed regression-based decomposition models and microdata for the total workforce in Sweden in 2005 and 2013, we gauge inequality in three workforce groups: workers (W), self-employed (SE), and incorporated self-employed (ISE). By estimating inequality both within and between each of these sub-groups, our model provides a clear picture of the group dynamics that drive inequality at the workforce level. By tuning an entropybased inequality index to different segments of the income distribution, we are able to assess at which income level our two categories of entrepreneurs have the most impact. At a second stage of the analysis, our regression-based decomposition enables us to pinpoint the significance of each individual-level explanatory factor and their contribution to both sub-group and overall inequality.
Starting with overall inequality, our data show that for the 2005–2013 period, inequality development is quite stable and that its direction of change differs to some extent depending on which income measure we use. On the one hand, using market income (i.e., income measured before taxes and transfers), we see a very slight decrease in inequality. On the other hand, using disposable income (i.e., income after taxes and transfers), we instead see a very moderate increase. These developments are almost exclusively related to changes in the middle or bottom end of the income distribution (i.e., using measures like the Gini coefficient and GE (−1, 0)), which suggests that the income distribution is augmented by more people with lower levels of disposable income.