How the Distribution of After-Tax Income Changed Over the 1990s Business Cycle: A Comparison of the United States, Great Britain, Germany and Japan

Abstract

Using kernel density estimation we find that, over their 1990s business cycles, the entire distribution of after-tax household size-adjusted income moved to the right in the United States and Great Britain while inequality declined. In contrast, Germany and Japan had less income growth, a rise in inequality and a decline in the middle mass of their distributions that spread mostly to the right, much like the United States experienced over its 1980s business cycle. In the United States and Japan, younger persons fared relatively better than older persons while the opposite was the case in Great Britain and Germany.

Using the P90/P10 Index to Measure U.S. Inequality Trends With Current Population Survey Data: A View From Inside the Census Bureau Vaults

“…For a fuller discussion of this method, see Feng et al. (2006) for its application to labor earnings, and Burkhauser et al. (2008) for its application to size‐adjusted household income.…”

“…Other recent examples include Alderson et al. (2005), Prus and Brown (2006), Atkinson (2007), Brandolini (2007) and Burkhauser et al. (2008).…”

Estimating trends in US income inequality using the Current Population Survey: the importance of controlling for censoring

“…Its use is increasing in studies of US income distribution trends. See Burkhauser, Couch, Houtenville and Rovba [15], Gottschalk and Danziger [33], and Burkhauser, Osaki, and Rovba [20]. income for the calendar year preceding the March interview.…”

“… Gottschalk and Danziger [33] apply consistent topcoding methods. See also Burkhauser, Butler, Feng, and Houtenville[14], Feng, Burkhauser, and Butler[30], and Burkhauser, Oshio, and Rovba[20] 19. Until recently, consistent topcoding was the best method available for dealing with topcoding, as it allowed researchers to analyze a consistent fraction of the population.…”

The Impact of Household Capital Income on Income Inequality - A Factor Decomposition Analysis for Great Britain, Germany and the USA

“…There is ample evidence in the literature showing a significant increase in income inequality since the mid-1970s in a wide range of OECD countries (e.g., Atkinson et al 1995, Milanovic 2005, Burkhauser et al 2007). While scholars agree on the existence of inequality, the question of its underlying causes still remains largely unanswered.…”