Lifelong Learning and Income Inequality: Panel Evidence from 30 Countries

Abstract Recent developments in technology direct us to a rapid restructuring of labor market skill requirements, which situates lifelong learning at the center of policies whose aim is to respond to increasing inequality. Although interest is growing, the macroeconomic association between lifelong learning and income inequality is still largely unexplored at the cross-country level. The present paper presents the necessary evidence regarding this relationship through panel data for 30 countries covering the period of 2004–2022. Using panel local projections with instrumental variables, to address endogeneity, we discovered that a 1 p.p. increase in lifelong learning participation led to a progressive reduction in the Gini coefficient of 0.26 points. The effects are more pronounced in both periphery countries and individuals with lower levels of formal education. The findings indicate that to reduce inequality a successful policy instrument is focused investment in lifelong learning, particularly in less developed economies and for low-skilled workers.