Trends in Income Inequality, Volatility, and Mobility Risk
AbstractThere has been a renewed interest in recent years in income inequality, economic mobility, and income volatility. I define an aggregate measure of income risk as half the squared coefficient of variation of incomes measured over both people and time, which can be decomposed into an inequality component measuring dispersion in mean incomes, a volatility component measuring the average dispersion of fluctuations about person-specific trends, and a mobility component measuring the dispersion of person-specific trends. I apply this decomposition to the Panel Study of Income Dynamics to characterize trends in inequality, volatility, and mobility over the last several decades in the United States. I also examine changes in the regressivity of income growth over time.
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Bibliographic InfoPaper provided by IRISS at CEPS/INSTEAD in its series IRISS Working Paper Series with number 2008-10.
Length: 41 pages
Date of creation: Nov 2008
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inequality ; volatility ; instability ; mobility ; progressivity;
Find related papers by JEL classification:
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
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