Summary
We study the evolution of earnings inequality in Switzerland during the recession of the 1990s. We compare the Lorenz curves of the 1992 and 1997 distributions, as well as the related generalised Lorenz curves, given the pay deterioration witnessed during this period. The Lorenz curve is shown to move upward. However, on the basis of the generalised Lorenz criterion, we are led to conclude that this reduction in inequality was insufficient, from a social welfare perspective, to make up for the reduction in average pay.