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Recent Trends in Household Income Dynamics for the United States, Germany and Great Britain

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  • Sisi Zhang

    (The Urban Institute)

Abstract

This paper examines the recent trends in household income volatility in the United States, Germany and Great Britain, and compares household income volatility with individual income volatility. I estimate a formal error components model using the Cross-national Equivalence File from 1979 to 2004. I find that household income volatility, measured by the transitory variance of household income, accounts for more than half of the total income variance for all three countries. Despite the differences in the total household income variances among the three countries, the permanent variances converges since the late 1990s.

Suggested Citation

  • Sisi Zhang, 2010. "Recent Trends in Household Income Dynamics for the United States, Germany and Great Britain," Economics Bulletin, AccessEcon, vol. 30(2), pages 1154-1172.
    • Handle: RePEc:ebl:ecbull:eb-10-00140
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    Cited by:

    1. Robert Moffitt & Sisi Zhang, 2018. "The PSID and Income Volatility: Its Record of Seminal Research and Some New Findings," The ANNALS of the American Academy of Political and Social Science, , vol. 680(1), pages 48-81, November.
    2. Timothy M. Smeeding, 2018. "The PSID in Research and Policy," The ANNALS of the American Academy of Political and Social Science, , vol. 680(1), pages 29-47, November.

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    More about this item

    Keywords

    Household Income; Income Volatility; Permanent Inequality; Cross-National Comparison;
    All these keywords.

    JEL classification:

    • D3 - Microeconomics - - Distribution
    • D6 - Microeconomics - - Welfare Economics

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