Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/35875 
Year of Publication: 
2009
Series/Report no.: 
IZA Discussion Papers No. 4426
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
Although the majority of research on US income inequality trends is based on public-use March CPS data, a new wave of research using IRS tax return data reports substantially higher levels of inequality and faster growing trends. We show that these apparently inconsistent estimates are largely reconciled if the inequality measure and the income distribution are defined in the same way. Using internal CPS data for 1967-2006, we closely match IRS data-based estimates of top income shares reported by Piketty and Saez (2003). Our results imply that any inequality increases since 1993 are concentrated among the top 1 percent of the distribution.
Subjects: 
US income inequality
top income shares
March CPS
IRS tax return data
JEL: 
D31
C81
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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