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Top incomes in the UK over the 20th century

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  • A. B. Atkinson

Abstract

Summary. Recent changes in the distribution of income need to be placed in historical context. The paper provides new evidence about the evolution of top incomes in the UK over the 20th century. Making use of published tabulations of the income tax statistics, and of microdata for recent years, we construct estimates of the shares of top income groups, giving for the first time an annual time series for gross incomes that spans more than 90 years. The paper pays particular attention to the problems of data construction and of the interpretation of tax‐based evidence. The resulting statistics have evident limitations but throw light on periods, such as that between the First and Second World Wars, for which there is little other empirical material. The results bring out clearly how the major equalization of the first three‐quarters of the century in the UK has been reversed, taking the shares of the top income groups back to levels of inequality found 50 years ago. A similar U‐shaped pattern is found for the USA, but the post‐war experience of France is different from that in the UK.

Suggested Citation

  • A. B. Atkinson, 2005. "Top incomes in the UK over the 20th century," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 168(2), pages 325-343, March.
  • Handle: RePEc:bla:jorssa:v:168:y:2005:i:2:p:325-343
    DOI: 10.1111/j.1467-985X.2005.00351.x
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    References listed on IDEAS

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    1. Chipman, John S., 1974. "The welfare ranking of Pareto distributions," Journal of Economic Theory, Elsevier, vol. 9(3), pages 275-282, November.
    2. Simon Kuznets & Elizabeth Jenks, 1953. "Shares of Upper Income Groups in Income and Savings (1953)," NBER Books, National Bureau of Economic Research, Inc, number kuzn53-1.
    3. Thomas Piketty & Emmanuel Saez, 2003. "Income Inequality in the United States, 1913–1998," The Quarterly Journal of Economics, Oxford University Press, vol. 118(1), pages 1-41.
    4. A. B. Atkinson, 2004. "Income Tax and Top Incomes over the Twentieth Century," Hacienda Pública Española / Review of Public Economics, IEF, vol. 168(1), pages 123-141, march.
    5. Simon Kuznets & Elizabeth Jenks, 1953. "Shares of Upper Income Groups in Savings," NBER Chapters, in: Shares of Upper Income Groups in Income and Savings (1953), pages 171-218, National Bureau of Economic Research, Inc.
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