Capital and Labor : The Factor Income Composition of Top Incomes in the United States, 1962-2006
This paper finds that capital and labor incomes in the United States have become more closely associated since the 1980s. This contributed to the well-known increase in the top 1 percent's share of total income, exacerbating rising inequality...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2017
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/260871513017553079/Capital-and-labor-the-factor-income-composition-of-top-incomes-in-the-United-States-1962-2006 http://hdl.handle.net/10986/29004 |
| Summary: | This paper finds that capital and labor
incomes in the United States have become more closely
associated since the 1980s. This contributed to the
well-known increase in the top 1 percent's share of
total income, exacerbating rising inequality in capital
incomes and earnings. The paper shows that the trend in the
association is U-shaped, as the recent increase contrasts
with a tendency toward a weakening association until the
1980s. The paper uses data derived from tax records, studies
the asymmetries in the association, tests for robustness to
alternative income definitions, and discusses the potential
role of declining top marginal tax rates. |
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