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Rising Top-Income Persistence in Australia: Evidence from Income Tax Data

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  • Herault, Nicolas
  • Hyslop, Dean
  • Jenkins, Stephen P.
  • Wilkins, Roger

Abstract

We use a new Australian longitudinal income tax dataset, Alife, covering 1991–2017, to examine levels and trends in the persistence in top-income group membership, focussing on the top 1%. We summarize persistence in multiple ways, documenting levels and trends in rates of remaining in top-income groups; re-entry to the top; the income changes associated with top-income transitions; and we also compare top-income persistence rates for annual and ‘permanent’ incomes. Regardless of the perspective taken, top-income persistence increased markedly over the period, with most of the increase occurring in the mid-2000s and early 2010s. In the mid- to late-2010s, Australian top-income persistence rates appear to have been near the top of the range of tax-data estimates for other countries. Using univariate breakdowns and multivariate regression, we show that the rise in top-income persistence in Australia was experienced by many population subgroups. (Stone Center on Socio-Economic Inequality Working Paper)

Suggested Citation

  • Herault, Nicolas & Hyslop, Dean & Jenkins, Stephen P. & Wilkins, Roger, 2021. "Rising Top-Income Persistence in Australia: Evidence from Income Tax Data," SocArXiv az7tf, Center for Open Science.
    • Handle: RePEc:osf:socarx:az7tf
    DOI: 10.31219/osf.io/az7tf
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    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access

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