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Accounting for United States Household Income Inequality Trends: The Changing Importance of Household Structure and Male and Female Labor Earnings Inequality

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  • Jeff Larrimore

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type="main"> Using a shift-share analysis on March CPS data, this paper estimates the degree to which changes in labor earnings, employment, and marriage patterns account for household income inequality growth in the United States since 1979. The factors contributing to the rapid rise in income inequality in the 1980s differ substantially from those contributing to its slower increase since that time. Unlike findings for the 1980s when changes in the correlation of spouses' earnings accounted for income inequality growth, this factor is no longer a major contributor toward its continued increase. Additionally, the 2000s business cycle is the first full business cycle in at least 30 years where changes in earnings of male household heads accounted for declines in income inequality. Instead, the continued growth in income inequality in the 2000s was accounted for primarily by increases in female earnings inequality and declines in both male and female employment.

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  • Jeff Larrimore, 2014. "Accounting for United States Household Income Inequality Trends: The Changing Importance of Household Structure and Male and Female Labor Earnings Inequality," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(4), pages 683-701, December.
  • Handle: RePEc:bla:revinw:v:60:y:2014:i:4:p:683-701
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    2. Shoshana Grossbard & Lucia Mangiavacchi & William Nilsson & Luca Piccoli, 2019. "Spouses' Income Association and Inequality: A Non-Linear Perspective," Working Papers 2019-076, Human Capital and Economic Opportunity Working Group.
    3. Carlo V. FIORIO & Stefano VERZILLO, 2018. "Looking in Your Partner’s Pocket Before Saying “Yes!" Income Assortative Mating and Inequality," Departmental Working Papers 2018-02, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    4. Chimere O. Iheonu & Ozoemena S. Nwodo & Uchechi S. Anaduaka & Ugochinyere Ekpo, 2020. "Inequality and Female Labour Force Participation in West Africa," Working Papers of the African Governance and Development Institute. 20/076, African Governance and Development Institute..
    5. Lasse Eika & Magne Mogstad & Basit Zafar, 2019. "Educational Assortative Mating and Household Income Inequality," Journal of Political Economy, University of Chicago Press, vol. 127(6), pages 2795-2835.
    6. Iryna Kyzyma & Alessio Fusco & Philippe Van Kerm, 2022. "Distributional Change: Assessing the Contribution of Household Income Sources," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 84(1), pages 158-184, February.
    7. Bratsberg, Bernt & Markussen, Simen & Raaum, Oddbjørn & Røed, Knut & Røgeberg, Ole J., 2018. "Trends in Assortative Mating and Offspring Outcomes," IZA Discussion Papers 11753, Institute of Labor Economics (IZA).
    8. Olivier Bargain & Mathias Dolls & Herwig Immervoll & Dirk Neumann & Andreas Peichl & Nico Pestel & Sebastian Siegloch, 2011. "Tax policy and income inequality in the U.S., 1978—2009: A decomposition approach," Working Papers 215, ECINEQ, Society for the Study of Economic Inequality.
    9. Inhoe Ku & Wonjin Lee & Seoyun Lee & Kyounghoon Han, 2018. "The Role of Family Behaviors in Determining Income Distribution: The Case of South Korea," Demography, Springer;Population Association of America (PAA), vol. 55(3), pages 877-899, June.
    10. Chimere O. Iheonu & Ozoemena S. Nwodo & Uchechi S. Anaduaka & Ugochinyere Ekpo, 2020. "Inequality and Female Labour Force Participation in West Africa," Working Papers 20/076, European Xtramile Centre of African Studies (EXCAS).
    11. Mike Brewer & Liam Wren-Lewis, 2016. "Accounting for Changes in Income Inequality: Decomposition Analyses for the UK, 1978–2008," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 78(3), pages 289-322, June.
    12. SOLOGON Denisa & VAN KERM Philippe & LI Jinjing & O'DONOGHUE Cathal, 2018. "Accounting for Differences in Income Inequality across Countries: Ireland and the United Kingdom," LISER Working Paper Series 2018-01, Luxembourg Institute of Socio-Economic Research (LISER).
    13. Inhoe Ku & Wonjin Lee & Seoyun Lee, 2021. "Declining Family Support, Changing Income Sources, and Older People Poverty: Lessons from South Korea," Population and Development Review, The Population Council, Inc., vol. 47(4), pages 965-996, December.
    14. Katie M. Jajtner & Sophie Mitra & Christine Fountain & Austin Nichols, 2020. "Rising Income Inequality Through a Disability Lens: Trends in the United States 1981–2018," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 151(1), pages 81-114, August.
    15. Denisa M. Sologon & Philippe Kerm & Jinjing Li & Cathal O’Donoghue, 2021. "Accounting for differences in income inequality across countries: tax-benefit policy, labour market structure, returns and demographics," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(1), pages 13-43, March.
    16. Chimere O. Iheonu & Ozoemena S. Nwodo & Uchechi S. Anaduaka & Ugochinyere Ekpo, 2020. "Inequality and Female Labour Force Participation in West Africa," Working Papers of The Association for Promoting Women in Research and Development in Africa (ASPROWORDA). 20/008, The Association for Promoting Women in Research and Development in Africa (ASPROWORDA).
    17. Chimere O. Iheonu & Ozoemena S. Nwodo & Uchechi S. Anaduaka & Ugochinyere Ekpo, 2020. "Inequality and Female Labour Force Participation in West Africa," Research Africa Network Working Papers 20/076, Research Africa Network (RAN).
    18. Segato, Federico, 2021. "Female labour force participation and household income inequality in Italy," MPRA Paper 108280, University Library of Munich, Germany.
    19. , Stone Center & Yonzan, Nishant, 2020. "Assortative Mating and Labor Income Inequality: Evidence from Fifty Years of Coupling in the U.S," SocArXiv 4whvs, Center for Open Science.
    20. Milan Bouchet-Valat, 2017. "Does women’s employment growth increase wage inequalities between couples? The case of France between 1982 and 2014," Economie et Statistique / Economics and Statistics, Institut National de la Statistique et des Études Économiques (INSEE), issue 493, pages 67-85.
    21. Shoshana Grossbard & Lucia Mangiavacchi & William Nilsson & Luca Piccoli, 2022. "Spouses’ earnings association and inequality: A non-linear perspective," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 20(3), pages 611-638, September.
    22. Salverda, Wiemer & Checchi, Daniele, 2014. "Labour-Market Institutions and the Dispersion of Wage Earnings," IZA Discussion Papers 8220, Institute of Labor Economics (IZA).
    23. Diederik Boertien & Milan Bouchet-Valat, 2020. "Are Increasing Earnings Associations Between Partners of Concern for Inequality? A Comparative Study of 21 Countries," LIS Working papers 793, LIS Cross-National Data Center in Luxembourg.

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