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Top Earners: Cross-Country Facts

Author

Listed:
  • Alejandro Badel

    (Bureau of Labor Statistics and Georgetown University)

  • Moira Daly

    (Copenhagen Business School)

  • Mark Huggett

    (Georgetown University)

  • Martin Nybom

    (Stockholm University)

Abstract

We provide a common set of life-cycle earnings statistics based on administrative data from the United States, Canada, Denmark and Sweden. We find three qualitative patterns, which are common across countries. First, top-earnings inequality increases over the working lifetime. Second, the extreme right tail of the earnings distribution becomes thicker with age over the working lifetime. Third, top lifetime earners exhibit dramatically higher earnings growth over their working lifetime. Models of top earners should account for these three patterns and, importantly, for how they quantitatively differ across countries.

Suggested Citation

  • Alejandro Badel & Moira Daly & Mark Huggett & Martin Nybom, 2017. "Top Earners: Cross-Country Facts," Working Papers 2017-061, Human Capital and Economic Opportunity Working Group.
    • Handle: RePEc:hka:wpaper:2017-061
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    References listed on IDEAS

    as
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    Cited by:

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    3. Niels-Jakob Harbo Hansen & Karl Harmenberg & Erik Öberg & Hans Henrik Sievertsen, 2021. "Gender disparities in top earnings: measurement and facts for Denmark 1980-2013," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(2), pages 347-362, June.
    4. Lopez-Velasco, Armando R., 2024. "Neoclassical production, scarcity of skills and Pareto distributions," Economics Letters, Elsevier, vol. 234(C).
    5. Terhi Ravaska, 2020. "Gender-specific top incomes: are they Pareto distributed?," Economics Bulletin, AccessEcon, vol. 40(3), pages 1994-2004.
    6. Benhabib, Jess & Hager, Mildred, 2021. "Revenue diversion, the allocation of talent, and income distribution," Mathematical Social Sciences, Elsevier, vol. 112(C), pages 138-144.

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    More about this item

    Keywords

    Earnings; Inequality; top earners; top incomes;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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