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Importing inequality: immigration and the top 1 percent

Author

Listed:
  • Arun Advani

    (Institute for Fiscal Studies and University of Warwick)

  • Felix Koenig

    (Institute for Fiscal Studies and Carnegie Mellon University)

  • Lorenzo Pessina

    (Institute for Fiscal Studies and Columbia University, New York)

  • Andy Summers

    (Institute for Fiscal Studies and London School of Economics)

Abstract

In this paper we study the contribution of migrants to the rise in UK top incomes. Using administrative data on the universe of UK taxpayers we show migrants are over-represented at the top of the income distribution, with migrants twice as prevalent in the top 0.1% as anywhere in the bottom 97%. These high incomes are predominantly from labour, rather than capital, and migrants are concentrated in only a handful of industries, predominately finance. Almost all (85%) of the growth in the UK top 1% income share over the past 20 years can be attributed to migration.

Suggested Citation

  • Arun Advani & Felix Koenig & Lorenzo Pessina & Andy Summers, 2020. "Importing inequality: immigration and the top 1 percent," IFS Working Papers W20/31, Institute for Fiscal Studies.
    • Handle: RePEc:ifs:ifsewp:20/31
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    Cited by:

    1. Arun Advani & George Bangham & Jack Leslie, 2021. "The UK's wealth distribution and characteristics of high‐wealth households," Fiscal Studies, John Wiley & Sons, vol. 42(3-4), pages 397-430, September.
    2. Brian Bell & Nicholas Bloom & Jack Blundell, 2021. "This time is not so different: income dynamics during the Covid-19 recession," POID Working Papers 012, Centre for Economic Performance, LSE.
    3. Arun Advani & Hannah Tarrant, 2021. "Behavioural responses to a wealth tax," Fiscal Studies, John Wiley & Sons, vol. 42(3-4), pages 509-537, September.
    4. Advani, Arun & Burgherr, David & Savage, Mike & Summers, Andrew, 2022. "The UK’s global economic elite: a sociological analysis using tax data," LSE Research Online Documents on Economics 114607, London School of Economics and Political Science, LSE Library.
    5. Monica BURESCU MIHĂILA & Paula Roxana CUCOȘ, 2023. "Implications of migration policies on reducing income inequalities and poverty in Europe," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(635), S), pages 23-42, Summer.
    6. Linsi, Lukas & Hopkin, Jonathan & Jaupart, Pascal, 2023. "Exporting inequality: US investors and the Americanization of executive pay in the United Kingdom," LSE Research Online Documents on Economics 113543, London School of Economics and Political Science, LSE Library.
    7. Christian Dustmann & Yannis Kastis & Ian Preston, 2023. "Inequality and Immigration," CESifo Working Paper Series 10486, CESifo.
    8. Advani, Arun & Burgherr, David & Summers, Andy, "undated". "Taxation and Migration by the Super-Rich," CAGE Online Working Paper Series 630, Competitive Advantage in the Global Economy (CAGE).
    9. Rhea Ravenna Sohst & Alessio Fusco & Philippe Van Kerm, 2024. "Foreign-born households’ contribution to inequality and polarization in European income distributions," LISER Working Paper Series 2024-06, Luxembourg Institute of Socio-Economic Research (LISER).

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    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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