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Changes in Canadian Family Income and Family Consumption Inequality between 1978 and 1992

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  • Pendakur, Krishna

Abstract

This paper uses Canadian cross-sectional income and expenditure data to examine changes in the distribution of family income and family consumption during the period 1978 to 1992. Family consumption data are analyzed because in the presence of intertemporal consumption smoothing, the cross-sectional distribution of consumption may characterize the distribution of lifetime wealth. The author finds that both Canadian family income inequality and Canadian family consumption inequality moved countercyclically. In addition, both Canadian family income inequality and Canadian family consumption inequality trended upward over the period; however, the change in family consumption inequality was much smaller than the change in family income inequality, suggesting that inequality in the distribution of lifetime wealth may have changed much less than is suggested by changes in the distribution of income. Copyright 1998 by The International Association for Research in Income and Wealth.

Suggested Citation

  • Pendakur, Krishna, 1998. "Changes in Canadian Family Income and Family Consumption Inequality between 1978 and 1992," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 44(2), pages 259-283, June.
  • Handle: RePEc:bla:revinw:v:44:y:1998:i:2:p:259-83
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    References listed on IDEAS

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    1. Gustafsson, Bjorn, 1994. "The Degree and Pattern of Income Immobility in Sweden," Review of Income and Wealth, International Association for Research in Income and Wealth, pages 67-86.
    2. Richard V. Burkhauser & John G. Poupore, 1997. "A Cross-National Comparison Of Permanent Inequality In The United States And Germany," The Review of Economics and Statistics, MIT Press, pages 10-17.
    3. Jenkins, Stephen P & Lambert, Peter J, 1993. "Ranking Income Distributions When Needs Differ," Review of Income and Wealth, International Association for Research in Income and Wealth, pages 337-356.
    4. Sen, Amartya, 1973. "On Economic Inequality," OUP Catalogue, Oxford University Press, number 9780198281931.
    5. Bound, John & Krueger, Alan B, 1991. "The Extent of Measurement Error in Longitudinal Earnings Data: Do Two Wrongs Make a Right?," Journal of Labor Economics, University of Chicago Press, vol. 9(1), pages 1-24, January.
    6. Anders Bjorklund & Richard B. Freeman, 1997. "Generating Equality and Eliminating Poverty, the Swedish Way," NBER Chapters,in: The Welfare State in Transition: Reforming the Swedish Model, pages 33-78 National Bureau of Economic Research, Inc.
    7. Topel, Robert H, 1991. "Specific Capital, Mobility, and Wages: Wages Rise with Job Seniority," Journal of Political Economy, University of Chicago Press, vol. 99(1), pages 145-176, February.
    8. Pederson, P. J. & Schmidt-Sorensen, J. B. & Smith, N. & Westergard-Nielsen, N., 1990. "Wage differentials between the public and private sectors," Journal of Public Economics, Elsevier, pages 125-145.
    9. Peter Gottschalk & Robert Moffitt, 1994. "The Growth of Earnings Instability in the U.S. Labor Market," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, pages 217-272.
    10. Shorrocks, Anthony, 1978. "Income inequality and income mobility," Journal of Economic Theory, Elsevier, vol. 19(2), pages 376-393, December.
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    Cited by:

    1. Dirk Kreuger & Fabrizio Perri, 2002. "Does Income Inequality Lead to Consumption Inequality? Evidence and Theory," Working Papers 02-15, New York University, Leonard N. Stern School of Business, Department of Economics.
    2. Jeremy Lise & Shannon Seitz, 2007. "Consumption inequality and intra-household allocations," IFS Working Papers W07/09, Institute for Fiscal Studies.
    3. Jeremy Lise & Shannon Seitz, 2011. "Consumption Inequality and Intra-household Allocations," Review of Economic Studies, Oxford University Press, pages 328-355.
    4. Rebecca Valenzuela & Hooi Hooi Lean, 2007. "Stochastic Dominance Analysis Of Australian Income Distributions," Monash Economics Working Papers 21-07, Monash University, Department of Economics.

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