Working Paper: NBER ID: w26996
Authors: Dennis Fixler; Marina Gindelsky; David Johnson
Abstract: This paper constructs a distribution of Personal Income for the United States (2007-2016) to investigate the relationship between inequality and macroeconomic growth. We extend a perspective first presented in Fixler and Johnson (2014) and further developed in Fixler et al. (2017) and Fixler, Gindelsky, and Johnson (2018, 2019) to develop a national account-based measure using a decade of publicly available survey, tax, and administrative data. By using (equivalized) households as the base unit of analysis and focusing on a more inclusive definition of income than most inequality studies (i.e., including health, transfers, and financial assets), we improve on existing economic measures of inequality in a meaningful way and bridge the gap between micro data and macro statistics. We produce a wide set of inequality results over the period, drawing a comparison with other studies (including Auten and Splinter (2019) and Piketty, Saez, and Zucman (2018)).
Keywords: Personal Income; Inequality; Macroeconomic Growth; National Income Accounts
JEL Codes: D31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Distribution of personal income (D31) | Macroeconomic growth trends (F62) |
| Macroeconomic growth trends (F62) | Income inequality (D31) |
| Real mean and median equivalized personal income increased (D31) | Slight increase in inequality (D31) |
| Changes in composition of personal income (D31) | Shifts in income inequality (D31) |