Updated Facts on the U.S. Distributions of Earnings, Income, and Wealth

Abstract

The purpose of this article is to report facts on the distributions of earnings, income, and wealth in the United States.Specifically, we update the 1997 report published in the Quarterly Review (Diaz-Gimenez, Quadrini, and Rios-Rull 1997) that used data from the 1992 Survey of Consumer Finances (SCF) with the most recent wave of that survey, which dates from 1998.In this update, we do three things: we update the old tables using the new data; we add some new tables with data that have proved to be useful for our understanding of inequality and which are not part of the 1997 report; and we describe some of the changes that took place between the two periods considered.Even though our understanding of inequality has advanced significantly since 1997, there is still no established theory to help organize the data.Therefore, we have attempted to report the data in a format that satisfies the following two criteria: it should be possible to analyze the data with any given theoiy of inequality, and it should be possible to use the data to test the implications of any giv-en theory of inequality.Thus, the pages that follow are an attempt to highlight the main features of the data in a coherent and summarized fashion.This article, however, is not an attempt to carry out a thorough statistical analysis of the data.As did the last report, this one uses the two most reliable sources of data on inequality: the SCF mentioned above and the Panel Study of Income Dynamics (PSID).Every fact that we report in this article has been constructed from the data obtained from those two sources.Here we use the 1998 SCF and various recent waves of the PSID.(For technical details about these sources, see the Appendix.)