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Estimating trends in US income inequality using the Current Population Survey: the importance of controlling for censoring

  • Burkhauser, Richard V.
  • Feng, Shuaizhang
  • Jenkins, Stephen P.
  • Larrimore, Jeff

Using internal and public use March Current Population Survey data, we analyze trends in US income inequality (1975-2004). Using a multiple imputation approach where values for censored observations are imputed using draws from a Generalized Beta distribution of the Second Kind, we find that the upward trend in income inequality significantly slowed after 1993. Our results closely match the income share trends reported by Piketty and Saez (2003) except for within the top 1 percent of the distribution. Thus, we argue that if inequality has increased substantially since 1993, such increases are confined to this very high income group.

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File URL: https://www.iser.essex.ac.uk/research/publications/working-papers/iser/2008-25.pdf
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Paper provided by Institute for Social and Economic Research in its series ISER Working Paper Series with number 2008-25.

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Date of creation: 04 Sep 2008
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Publication status: published
Handle: RePEc:ese:iserwp:2008-25
Contact details of provider: Postal: Publications Office, Institute for Social and Economic Research, University of Essex, Wivenhoe Park, Colchester, Essex CO4 3SQ UK
Phone: 44-1206-872957
Fax: 44-1206-873151
Web page: https://www.iser.essex.ac.uk/
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  12. Richard V. Burkhauser & Shuaizhang Feng & Stephen P. Jenkins & Jeff Larrimore, 2008. "Estimating Trends in US Income Inequality Using the Current Population Survey: The Importance of Controlling for Censoring," NBER Working Papers 14247, National Bureau of Economic Research, Inc.
  13. Richard Burkhauser & Shuaizhang Feng & Stephen Jenkins, 2007. "Using the P90/P10 Index to Measure U.S. Inequality Trends with Current Population Survey Data: A View From Inside the Census Bureau Vaults," Working Papers 07-17, Center for Economic Studies, U.S. Census Bureau.
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