Income mobility in Ecuador: New evidence from individual income tax returns

Arbeitspapier

This paper presents new evidence on the study of income mobility in Ecuador over the period 2004 - 11. We utilize longitudinal data of individual income tax returns to measure income mobility both at the top and at the middle of the income distribution, and we find three main empirical results. First, income mobility in Ecuador is low for top incomes: the probability of remaining in the top 1 per cent after one year is nearly 66 per cent, and it remains stable by the end of the period. Second, there is a high degree of mobility for the rest of the income distribution. Individuals are more likely to experience upward mobility than downward mobility, especially those in the middle income defiles. Third, regression results suggest that the initial position in the income distribution is highly related to the probability of upward or downward mobility. Moreover, having a high-school degree is associated with upward income movements. To our knowledge, this is the first time that research uses data from tax returns to measure income mobility in this South American economy.

Object Details

• ISBN: 978-92-9230-925-1
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: WIDER Working Paper ; No. 2015/040

Classification and Topics

• Classification: Wirtschaft ; Personal Income, Wealth, and Their Distributions ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes ; Economic History: Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy: Latin America; Caribbean ; Economywide Country Studies: Latin America; Caribbean
• Subject: income mobility ; income inequality ; top incomes ; middle class ; Latin America

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Cano, Liliana
• Event: Veröffentlichung
• (who): The United Nations University World Institute for Development Economics Research (UNU-WIDER)
• (where): Helsinki
• (when): 2015

Further information

• DOI: doi:10.35188/UNU-WIDER/2015/925-1
• Handle: http://hdl.handle.net/10419/126369
• Last update: 10.03.2025, 11:43 AM CET