Unequal we stand: An empirical analysis of economic inequality in the United States, 1967-2006

Review of Economic Dynamics

Volumn 13, Issue 1, 2010, Pages 15-51

  Heathcote, Jonathan ^a,d   Perri, Fabrizio ^a,b,d,e   Violante, Giovanni L ^c,d,e  

^a FEDERAL RESERVE BANK OF MINNEAPOLIS   (United States)

^b UNIVERSITY OF MINNESOTA   (United States)

^c NEW YORK UNIVERSITY   (United States)

^d CEPR   (United Kingdom)

^e NATIONAL BUREAU OF ECONOMIC RESEARCH   (United States)

Author keywords

Consumption, income, and wealth inequality; Inequality over the life cycle; Wage dynamics

Indexed keywords

EID: 72249087571     PISSN: 10942025     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.red.2009.10.010     Document Type: Article

References (81)

1. Abowd J.M., and Card D. On the covariance structure of earnings and hours changes. Econometrica 57 2 (1989) 411-445
2. Acemoglu D. Technical change, inequality and the labor market. Journal of Economic Literature 40 1 (2002) 7-72
3. Aguiar M., and Hurst E. Measuring trends in leisure: The allocation of time over five decades. Quarterly Journal of Economics 122 3 (2007) 969-1006
4. Aguiar, Mark, Hurst, Erik, 2009. Deconstructing life cycle expenditures. Mimeo, University of Rochester
5. Aiyagari R.S. Uninsured idiosyncratic risk and aggregate saving. Quarterly Journal of Economics 109 3 (1994) 659-684
6. Atrostic, Barbara K., Kalenkoski, Charlene, 2002. Item response rates: One indicator of how well we measure income. In: Proceedings of the Annual Meetings of the American Statistical Association
7. Attanasio O., Battistin E., and Ichimura H. What really happened to consumption inequality in the US?. In: Berndt E., and Hulten C. (Eds). Hard-to-Measure Goods and Services: Essays in Honor of Zvi Griliches (2007), University of Chicago Press, Chicago
8. Autor D.H., Katz L.F., and Kearney M.S. Trends in US wage inequality: Revising the revisionists. Review of Economics and Statistics 90 2 (2008) 300-323
9. Baker M. Growth-rate heterogeneity and the covariance structure of life-cycle earnings. Journal of Labor Economics 15 2 (1997) 338-375
10. Barlevy G., and Tsiddon D. Earnings inequality and the business cycle. European Economic Review 50 1 (2006) 55-89
11. Battistin, Erich, 2003. Errors in survey reports of consumption expenditures. Institute for Fiscal Studies working paper 03/07
12. Blundell R., and Etheridge B. Consumption, income and earnings inequality in Britain. Review of Economic Dynamics 13 1 (2010) 76-102
13. Blundell R., Pistaferri L., and Preston I. Consumption inequality and partial insurance. American Economic Review 98 5 (2008) 1887-1921
14. Bound J., and Johnson G. Changes in the structure of wages in the 1980s: An evaluation of alternative explanations. American Economic Review 82 3 (1992) 371-382
15. Brzozowski M., Gervais M., Klein P., and Suzuki M. Consumption, income, and wealth inequality in Canada. Review of Economic Dynamics 13 1 (2010) 52-75
16. Bucks B.K., Kennickell A.B., Mach T.L., and Moore K.B. Changes in US family finances from 2004 to 2007: Evidence from the survey of consumer finances. Federal Reserve Bulletin 95 (2009) A1-A55
17. Budría Rodríguez S., Díaz-Giménez J., Quadrini V., and Ríos-Rull J.-V. Updated facts on the US distributions of earnings, income, and wealth. Federal Reserve Bank of Minneapolis Quarterly Review 26 3 (2002) 2-35
18. Burtless G. Effects of growing wage disparities and changing family composition on the US income distribution. European Economic Review 43 4-6 (1999) 853-865
19. Cancian M., and Reed D. Assessing the effects of wives' earnings on family income inequality. Review of Economics and Statistics 80 1 (1998) 73-79
20. Card D., and DiNardo J.E. Skill-biased technological change and rising wage inequality: Some problems and puzzles. Journal of Labor Economics 20 4 (2002) 733-783
21. Carroll C. The buffer-stock theory of saving: Some macroeconomic evidence. Brookings Papers on Economic Activity 23 2 (1992) 61-156
22. Castañeda A., Díaz-Giménez J., and Ríos-Rull J.-V. Accounting for the US earnings and wealth inequality. Journal of Political Economy 111 4 (2003) 818-857
23. Congressional Budget Office Study. Appendix: Detailed tables for 1979 to 2005. Available online from. http://www.cbo.gov/ftpdocs/88xx/doc8885/Appendix_wtoc.pdf
24. Cutler D.M., and Katz L.F. Macroeconomic performance and the disadvantaged. Brookings Papers on Economic Activity 22 2 (1991) 1-74
25. Davis, Steve J., Haltiwanger, John, 1991. Wage dispersion between and within US manufacturing Plants, 1963-1986. NBER working paper 3722
26. Deaton A., and Paxson C. Intertemporal choice and inequality. Journal of Political Economy 102 3 (1994) 437-467
27. Domeij D., and Flodén M. Inequality trends in Sweden 1978-2004. Review of Economic Dynamics 13 1 (2010) 179-208
28. Duncan G., and Rodgers W. Has children's poverty become more persistent?. American Sociological Review 56 4 (1991) 538-550
29. Eckstein Z., and Nagypal E. The evolution of US earnings inequality: 1961-2002. Federal Reserve Bank of Minneapolis Quarterly Review 28 2 (2004) 10-29
30. Favilukis, Jack, Ludvigson, Sydney, Van Nieuwerburgh, Stijn, 2009. The macroeconomic effects of housing wealth, housing finance, and limited risk-sharing in general equilibrium. Mimeo, New York University
31. Fitzgerald, Terry J., 2008. Where has all the income gone? The Region. Federal Reserve Bank of Minneapolis
32. Fitzgerald, John M., Gottschalk, Peter, Moffitt, Robert A., 1998. An analysis of sample attrition in panel data: The Michigan panel study of income dynamics. NBER technical working paper 0220
33. Fuchs-Schündeln N., Krueger D., and Sommer M. Inequality trends for Germany in the last two decades: A tale of two countries. Review of Economic Dynamics 13 1 (2010) 103-132
34. Garner T., Janini G., Passero W., Paszkiewicz L., and Vendemia M. The CE and the PCE: A comparison. Monthly Labor Review (2006) 20-46
35. Gervais, Martin, Klein, Paul, 2008. Measuring consumption smoothing in CEX data. Mimeo, University of Western Ontario
36. Gottschalk P., and Danziger S. Inequality of wage rates, earnings and family income in the United States, 1975-2002. Review of Income and Wealth 51 2 (2005) 231-254
37. Gottschalk P., and Moffitt R.A. The growth of earnings instability in the US labor market. Brookings Papers on Economic Activity 25 2 (1994) 217-272
38. Guvenen, Fatih, 2007. An empirical investigation of labor income processes. Mimeo, University of Minnesota
39. Heathcote J., Storesletten K., and Violante G.L. Two views of inequality over the life cycle. Journal of the European Economic Association 3 2-3 (2005) 765-775
40. Heathcote, Jonathan, Storesletten, Kjetil, Violante, Giovanni L., 2008. The macroeconomic implications of rising wage inequality in the United States. Mimeo, New York University
41. Heathcote, Jonathan, Storesletten, Kjetil, Violante, Giovanni L., 2009. Consumption and labor supply with partial insurance: An analytical framework. Mimeo, New York University
42. Hornstein A., Krusell P., and Violante G.L. The effects of technical change on labor market inequalities. In: Aghion P., and Durlauf S. (Eds). Handbook of Economic Growth, vol. 1B (2005), North-Holland, Amsterdam
43. Hoynes, Hilary, 2008. The earned income tax credit, welfare reform, and the employment of low skill single mothers. Mimeo, University of California, Davis
44. Huggett M. The risk-free rate in heterogeneous-agent incomplete-insurance economies. Journal of Economic Dynamics and Control 17 5-6 (1993) 953-969
45. Huggett, Mark, Ventura, Gustavo, Yaron, Amir, 2008. Sources of lifetime inequality. Mimeo, Georgetown University
46. Imrohoroglu A. Cost of business cycles with indivisibilities and liquidity constraints. Journal of Political Economy 97 December (1989) 1364-1383
47. Jappelli T., and Pistaferri L. Does consumption inequality track income inequality in Italy. Review of Economic Dynamics 13 1 (2010) 133-153
48. Jeong, Hyeok, Kim, Yong, Manovskii, Iourii, 2008. The price of experience. Mimeo, University of Pennsylvania
49. Juhn C., Murphy K.M., and Pierce B. Wage inequality and the rise in returns to skill. Journal of Political Economy 101 3 (1993) 410-442
50. Kaplan, Greg, 2008. Inequality and the lifecycle. Mimeo, New York University
51. Kaplan, Greg, Violante, Giovanni L., 2008. How much consumption insurance beyond self-insurance? Mimeo, New York University
52. Katz L.F., and Autor D.V. Changes in the wage structure and earnings inequality. In: Ashenfelter O., and Card D. (Eds). Handbook of Labor Economics, vol. 3A (1999), North-Holland, Amsterdam
53. Katz L.F., and Murphy K.M. Changes in relative wages, 1963-1987: Supply and demand factors. Quarterly Journal of Economics 107 1 (1992) 35-78
54. Kim Y.-S., and Stafford F.P. The quality of PSID income data in the 1990's and beyond. Available online from (2000). http://psidonline.isr.umich.edu/Guide/Quality/q_inc_data.html
55. Kopczuk, Wojciech, Saez, Emmanuel, Song, Jae, 2009. Uncovering the American dream: Inequality and mobility in social security earnings data since 1937. NBER working paper 13345
56. Korinek A., Mistiaen J.A., and Ravallion M. Survey nonresponse and the distribution of income. Journal of Economic Inequality 4 1 (2006) 33-55
57. Krueger D., and Perri F. Does income inequality lead to consumption inequality? Evidence and theory. Review of Economic Studies 73 1 (2006) 163-193
58. Krueger, Dirk, Perri, Fabrizio, 2009. How do households respond to income shocks? Mimeo, University of Pennsylvania
59. Krusell P., Ohanian L.E., Ríos-Rull J.-V., and Violante G.L. Capital-skill complementarity and inequality: A macroeconomic analysis. Econometrica 68 5 (2000) 1029-1054
60. Larrimore, Jeff, Burkhauser, Richard V., Feng, Shuaizhang, Zayatz, Laura, 2008. Consistent cell means for topcoded incomes in the public use march CPS (1967-2007). NBER working paper 13941
61. Lee D.S. Wage inequality in the United States during the 1980s: Rising dispersion or falling minimum wage?. Quarterly Journal of Economics 114 3 (1999) 977-1023
62. Lemieux, Thomas, 2006. Post-secondary education and increasing wage inequality. NBER working paper 12077
63. Levy F., and Murnane R.J. US earnings levels and earnings inequality: A review of recent trends and proposed explanations. Journal of Economic Literature 30 3 (1992) 1333-1381
64. Lillard L.A., and Weiss Y. Components of variation in panel earnings data: American scientists, 1960-1970. Econometrica 47 2 (1979) 437-454
65. Lillard L.A., and Willis R.J. Dynamic aspects of earning mobility. Econometrica 46 5 (1978) 985-1012
66. MaCurdy T.E. The use of time series processes to model the error structure of earnings in a longitudinal data analysis. Journal of Econometrics 18 1 (1982) 83-114
67. McGrattan E.R., and Rogerson R. Changes in hours worked, 1950-2000. Federal Reserve Bank of Minneapolis Quarterly Review 28 1 (2004) 14-33
68. Meghir C., and Pistaferri L. Income variance dynamics and heterogeneity. Econometrica 72 1 (2004) 1-32
69. Murphy K.M., and Topel R.H. The evolution of unemployment in the United States 1968-1985. NBER Macroeconomics Annual 2 (1987) 11-58
70. Murphy K.M., and Welch F. The structure of wages. Quarterly Journal of Economics 107 1 (1992) 285-326
71. Nelson J.A. On testing for full insurance using consumer expenditure survey data: Comment. Journal of Political Economy 102 2 (1994) 384-394
72. Piketty T., and Saez E. Income inequality in the United States, 1913-1998. Quarterly Journal of Economics 118 1 (2003) 1-39
73. Piketty, Thomas, Saez, Emmanuel, 2006. How progressive is the US federal tax system? A Historical and International Perspective. NBER working paper 12404
74. Pistaferri, Luigi, 2009. Two views of inequality over the life cycle: A comment. Mimeo, Stanford University
75. Ríos-Rull J.-V. Models with heterogeneous agents. In: Cooley T.F. (Ed). Frontiers of Business Cycle Research (1995), Princeton University Press, Princeton, NJ
76. Roemer, Mark I., 2002. Using administrative earnings records to assess wage data quality in the march current population survey and the survey of income and program participation. US Census Bureau working paper
77. Ruser, John, Pilot, Adrienne, Nelson, Charles, 2004. Alternative measures of household income: BEA personal income, CPS money income, and beyond. Federal Economic Statistics Advisory Committee working paper
78. Slesnick D.T. Consumption and Social Welfare: Living Standards and Their Distribution in the United States (2001), Cambridge University Press, New York
79. Storesletten K., Telmer C.I., and Yaron A. Consumption and risk sharing over the life cycle. Journal of Monetary Economics 51 3 (2004) 609-633
80. Storesletten K., Telmer C.I., and Yaron A. Cyclical dynamics in idiosyncratic labor market risk. Journal of Political Economy 112 3 (2004) 695-717
81. Weinberg, Bruce, 2005. Experience and technology adoption. Mimeo, Ohio State University