How business income affects economic inequality

This seminar presents estimates of income concentration and inequality for Norway using a new comprehensive measure of income, which identifies business income as it accrues rather than when it is realised, and high quality register data, which allow the researchers to account for multiple layers of business ownership.

Compared to conventional official statistics, the researchers' new measure implies that the share of income attributable to the top 1% of the distribution more than doubles and the Gini coefficient estimates increase by about 35% on average. Moreover, the new measure identifies substantial tax regressivity for individuals in the top percentile, a feature that cannot be detected by standard measures. For instance, while the fraction of gross income paid in taxes by individuals at the 99th percentile is about 37% in 2016, the corresponding fraction paid by individuals in the top 0.1% is 18%.

This event will be particularly useful for academics and policy makers.

Related links

• Quantitative Social Science (QSS)
• Centre for Longitudinal Studies (CLS)
• QSS and CLS seminar series
• UCL Social Research Institute

Image

Credit: Adeolu Eletu / Unsplash.