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Top Incomes in Indonesia, 1920-2004

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  • Andrew Leigh
  • Pierre van der Eng

Abstract

Using taxation and household survey data, this paper estimates top income shares for Indonesia during 1920-2004. Our results suggest that top income shares grew during the 1920s and 1930s, but fell in the post-war era. In more recent decades, we observe a sharp rise in top income shares during the late-1990s, coincident with the economic downturn, and some evidence that top income shares fell in the early-2000s. For pre-war Indonesia, we decompose top income shares by income source, and find that for groups below the top 0.5 percent, a majority of income was derived from wages. Throughout the twentieth century, top income shares in Indonesia have been higher than in India, broadly comparable to Japan, and somewhat lower than levels prevailing in the United States.

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File URL: http://cbe.anu.edu.au/research/papers/ceprdpapers/DP549.pdf
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Bibliographic Info

Paper provided by Centre for Economic Policy Research, Research School of Economics, Australian National University in its series CEPR Discussion Papers with number 549.

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Date of creation: Mar 2007
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Handle: RePEc:auu:dpaper:549

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Keywords: inequality; top incomes; personal income taxation; Indonesia;

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References

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  1. Peter Timmer, 2004. "The Road to Pro-Poor Growth: The Indonesian Experience in Regional Perspective," Working Papers 38, Center for Global Development.
  2. Facundo Alvaredo, 2007. "The Rich in Argentina over the twentieth century: From the Conservative Republic to the Peronist experience and beyond 1932-2004," PSE Working Papers halshs-00588318, HAL.
  3. James B. Davies & Anthony Shorrocks & Edward N. Wolff, 2010. "The World Distribution of Household Wealth," Working Papers id:3217, eSocialSciences.
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Citations

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Cited by:
  1. Sambit Bhattacharyya & Budy P. Resosudarmo, 2013. "Growth, Growth Accelerations and the Poor: Lessons from Indonesia," CSAE Working Paper Series 2013-14, Centre for the Study of African Economies, University of Oxford.
  2. Andy Sumner & Peter Edward, 2013. "From Low Income, High Poverty to High-Income, No Poverty? An Optimistic View of the Long-Run Evolution of Poverty in Indonesia By International Poverty Lines, 1984–2030," Working Papers in Economics and Development Studies (WoPEDS) 201310, Department of Economics, Padjadjaran University, revised Jun 2013.
  3. Brzezinski, Michal, 2013. "Asymptotic and bootstrap inference for top income shares," Economics Letters, Elsevier, vol. 120(1), pages 10-13.
  4. Andy Sumner, 2013. "The Evolution Of Education And Health Poverty During Economic Development:The Case Of Indonesia, 1991–2007," Working Papers in Economics and Development Studies (WoPEDS) 201311, Department of Economics, Padjadjaran University, revised May 2013.
  5. Facundo Alvaredo, 2008. "Top incomes and earnings in Portugal 1936-2004," Working Papers halshs-00586795, HAL.
  6. Anthony B. Atkinson & Thomas Piketty & Emmanuel Saez, 2009. "Top Incomes in the Long Run of History," NBER Working Papers 15408, National Bureau of Economic Research, Inc.
  7. Lakner, Christoph & Milanovic, Branko, 2013. "Global income distribution : from the fall of the Berlin Wall to the great recession," Policy Research Working Paper Series 6719, The World Bank.
  8. Foldvari, Peter & van Leeuwen, Bas & Marks, Daan & Gall, Jozsef, 2013. "Indonesian regional welfare development, 1900–1990: New anthropometric evidence," Economics & Human Biology, Elsevier, vol. 11(1), pages 78-89.
  9. Fiorio, Carlo V & Saget, Catherine, 2010. "Reducing or aggravating inequality? : Preliminary findings from the 2008 financial crisis," ILO Working Papers 456487, International Labour Organization.
  10. Jörg Baten & Mojgan Stegl & Pierre Eng, 2013. "The biological standard of living and body height in colonial and post-colonial Indonesia, 1770–2000," Journal of Bioeconomics, Springer, vol. 15(2), pages 103-122, July.
  11. Facundo Alvaredo, 2007. "The Rich in Argentina over the twentieth century: From the Conservative Republic to the Peronist experience and beyond 1932-2004," Working Papers halshs-00588318, HAL.
  12. Alvaredo, Facundo, 2009. "Top incomes and earnings in Portugal 1936-2005," Explorations in Economic History, Elsevier, vol. 46(4), pages 404-417, October.
  13. Michał Brzeziński, 2013. "Variance estimation for richness measures," Working Papers 2013-03, Faculty of Economic Sciences, University of Warsaw.

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