Arbeitspapier

Pareto models, top incomes, and recent trends in UK income inequality

I determine UK income inequality levels and trends by combining inequality estimates from tax return data (for the "rich") and household survey data (for the "non-rich"), taking advantage of the better coverage of top incomes in tax return data (which I demonstrate) and creating income variables in the survey data with the same definitions as in the tax data to enhance comparability. For top income recipients, I estimate inequality and mean income by fitting Pareto models to the tax data, examining specification issues in depth, notably whether to use Pareto I or Pareto II (generalised Pareto) models, and the choice of income threshold above which the Pareto models apply. The preferred specification is a Pareto II model with a threshold set at the 99th or 95th percentile (depending on year). Conclusions about aggregate UK inequality trends since the mid-1990s are robust to the way in which tax data are employed. The Gini coefficient for gross individual income rose by around 7% or 8% between 1996/97 and 2007/08, with most of the increase occurring after 2003/04. The corresponding estimate based wholly on the survey data is around -5%.

Sprache
Englisch

Erschienen in
Series: ISER Working Paper Series ; No. 2016-07

Klassifikation
Wirtschaft
Specific Distributions; Specific Statistics
Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
Personal Income, Wealth, and Their Distributions
Thema
inequality
top incomes
Pareto distribution
generalized Pareto distribution
survey under-coverage
HBAI
SPI

Ereignis
Geistige Schöpfung
(wer)
Jenkins, Stephen P.
Ereignis
Veröffentlichung
(wer)
University of Essex, Institute for Social and Economic Research (ISER)
(wo)
Colchester
(wann)
2016

Handle
Letzte Aktualisierung
20.09.2024, 08:23 MESZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Jenkins, Stephen P.
  • University of Essex, Institute for Social and Economic Research (ISER)

Entstanden

  • 2016

Ähnliche Objekte (12)