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Inequality in Indonesia: What can we learn from top incomes?

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  • Leigh, Andrew
  • van der Eng, Pierre

Abstract

Using taxation and household survey data, this paper estimates top income shares for Indonesia during 1920-2004. Our results suggest that top income shares grew during the 1920s and 1930s, but fell in the post-war era. We observe a sharp rise in top income shares during the late-1990s, coinciding with the 1997-98 economic crisis. Where comparable data are available, top income shares in Indonesia are generally higher than in other countries, a finding that is at odds with the view that Indonesia is a relatively egalitarian society. This suggests that top income shares may provide a more complete picture of developing country inequality in comparative perspective.

Suggested Citation

  • Leigh, Andrew & van der Eng, Pierre, 2009. "Inequality in Indonesia: What can we learn from top incomes?," Journal of Public Economics, Elsevier, vol. 93(1-2), pages 209-212, February.
  • Handle: RePEc:eee:pubeco:v:93:y:2009:i:1-2:p:209-212
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    More about this item

    Keywords

    Inequality Top incomes Personal income taxation Indonesia;

    JEL classification:

    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • N35 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Asia including Middle East
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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