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

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Author Info

  • Richard V. Burkhauser

    ()
    (Cornell University)

  • Takashi Oshio

    (Kobe University)

  • Ludmila Rovba

    (Analysis Group, Inc.)

Abstract

Using kernel density estimation we find that over the 1990s business cycles in the United States and Great Britain the entire distribution of after-tax (disposable) income moved to the right while inequality declined. In contrast, Germany and Japan experienced less growth, a rise in inequality, and a decline in the middle mass of their distributions, that spread mostly to the right, much like in the United States over its 1980s business cycle. Inequality fell within the older populations of all four countries; inequality also fell within the younger populations of the United States and Great Britain, but it rose substantially in Germany and Japan.

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Bibliographic Info

Article provided by Journal of Income Distribution in its journal Journal of Income Distribution.

Volume (Year): 17 (2008)
Issue (Month): 1 (March)
Pages: 87-109

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Handle: RePEc:jid:journl:y:2008:v:17:i:1:p:87-109

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Keywords: income inequality; kernel density estimation; economic well-being; crosscountry comparisons;

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References

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  1. Burkhauser, Richard V. & Smeeding, Timothy M. & Merz, Joachim, 1994. "Relative Inequality and Poverty in Germany and the United States Using Alternative Equivalence Scales," MPRA Paper 7229, University Library of Munich, Germany.
  2. Richard V. Burkhauser & Kenneth A. Couch & Andrew Houtenville & Ludmila Rovba, 2004. "Income Inequality in the 1990s: Re-Forging a Lost Relationship?," Working papers 2004-11, University of Connecticut, Department of Economics.
  3. Richard V. Burkhauser & Ludmila Rovba, 2006. "Income Inequality in the 1990s: Comparing the United States, Great Britain and Germany," Discussion Papers of DIW Berlin 576, DIW Berlin, German Institute for Economic Research.
  4. Thomas Piketty & Emmanuel Saez, 2003. "Income Inequality In The United States, 1913-1998," The Quarterly Journal of Economics, MIT Press, vol. 118(1), pages 1-39, February.
  5. Richard Burkhauser & Shuaizhang Feng & Stephen Jenkins, 2007. "Using the P90/P10 Index to Measure U.S. Inequality Trends with Current Population Survey Data: A View From Inside the Census Bureau Vaults," Working Papers 07-17, Center for Economic Studies, U.S. Census Bureau.
  6. Bach, Stefan & Corneo, Giacomo & Steiner, Viktor, 2007. "From Bottom to Top: The Entire Distribution of Market Income in Germany, 1992-2001," IZA Discussion Papers 2723, Institute for the Study of Labor (IZA).
  7. Toshiaki Tachibanaki, 2005. "Confronting Income Inequality in Japan: A Comparative Analysis of Causes, Consequences, and Reform," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262201585.
  8. Michael Förster & Mark Pearson, 2002. "Income Distribution and Poverty in the OECD Area: Trends and Driving Forces," OECD Economic Studies, OECD Publishing, vol. 2002(1), pages 7-38.
  9. Biewen, Martin, 2000. "Income Inequality in Germany during the 1980s and 1990s," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(1), pages 1-19, March.
  10. Burkhauser, Richard V. & Butler, J. S. & Feng, Shuaizhang & Houtenville, Andrew J., 2004. "Long term trends in earnings inequality: what the CPS can tell us," Economics Letters, Elsevier, vol. 82(2), pages 295-299, February.
  11. Lynn Karoly & Gary Burtless, 1995. "Demographic change, rising earnings inequality, and the distribution of personal well-being, 1959–1989," Demography, Springer, vol. 32(3), pages 379-405, August.
  12. Feng, Shuaizhang & Burkhauser, Richard V. & Butler, J.S., 2006. "Levels and Long-Term Trends in Earnings Inequality: Overcoming Current Population Survey Censoring Problems Using the GB2 Distribution," Journal of Business & Economic Statistics, American Statistical Association, vol. 24, pages 57-62, January.
  13. Kenneth A. Couch & Mary C. Daly, 2004. "The Improving Relative Status of Black Men," Working papers 2004-12, University of Connecticut, Department of Economics.
  14. Burkhauser, Richard V, et al, 1999. "Testing the Significance of Income Distribution Changes over the 1980s Business Cycle: A Cross-National Comparison," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(3), pages 253-72, May-June.
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Citations

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Cited by:
  1. Richard Burkhauser & Shuaizhang Feng & Stephen Jenkins & Jeff Larrimore, 2008. "Estimating Trends in U.S. Income Inequality Using the Current Population Survey: The Importance of Controlling for Censoring," Working Papers 08-25, Center for Economic Studies, U.S. Census Bureau.
  2. Richard V. Burkhauser & Mary C. Daly & Jeff Larrimore & Joyce Kwok, 2008. "The Transformation in Who is Expected to Work in the United States and How it Changed the Lives of Single Mothers and People with Disabilities," Working Papers wp187, University of Michigan, Michigan Retirement Research Center.
  3. Richard V. Burkhauser & Mary C. Daly & Philip R. de Jong, 2008. "Curing the Dutch Disease: Lessons for United States Disability Policy," Working Papers wp188, University of Michigan, Michigan Retirement Research Center.

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