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Inequality in an Equal Society

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  • Laura A. Harvey
  • Jochen O. Mierau
  • James Rockey

Abstract

A society in which everybody is the same at the same stage of the life-cycle will exhibit substantial income and wealth inequality. We use this idea to empirically quantify natural inequality – the share of observed inequality attributable to life-cycle profiles of income and wealth. We document that recent increases in inequality in the United States and other developed countries are both larger than observed rates would suggest, and represent a distinct change from the period 1960-1980. Extrapolating our measures forward suggests that natural inequalities will fluctuate over the next 20 years before settling to a new higher level.

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  • Laura A. Harvey & Jochen O. Mierau & James Rockey, 2017. "Inequality in an Equal Society," LWS Working papers 26, LIS Cross-National Data Center in Luxembourg.
    • Handle: RePEc:lis:lwswps:26
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    More about this item

    Keywords

    Income Inequality; Wealth Inequality; Demographic Structure;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General

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