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Using the P90/P10 Index to Measure US Inequality Trends with Current Population Survey Data: A View from Inside the Census Bureau Vaults

Richard Burkhauser (), Shuaizhang Feng () and Stephen Jenkins ()

No 699, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: The March Current Population Survey (CPS) is the primary data source for estimation of levels and trends in labor earnings and income inequality in the USA. Time-inconsistency problems related to top coding in theses data have led many researchers to use the ratio of the 90th and 10th percentiles of these distributions (P90/P10) rather than a more traditional summary measure of inequality. With access to public use and restricted-access internal CPS data, and bounding methods, we show that using P90/P10 does not completely obviate timeinconsistency problems, especially for household income inequality trends. Using internal data, we create consistent cell mean values for all top-coded public use values that, when used with public use data, closely track inequality trends in labor earnings and household income using internal data. But estimates of longer-term inequality trends with these corrected data based on P90/P10 differ from those based on the Gini coefficient. The choice of inequality measure matters.

Keywords: Inequality; income; earnings; Current Population Survey; decile ratio; Gini coefficient (search for similar items in EconPapers)
JEL-codes: D3 J3 C8 (search for similar items in EconPapers)
Pages: 27 p.
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link)
http://www.diw.de/documents/publikationen/73/diw_01.c.60026.de/dp699.pdf (application/pdf)

Related works:
Journal Article: USING THE P90/P10 INDEX TO MEASURE U.S. INEQUALITY TRENDS WITH CURRENT POPULATION SURVEY DATA: A VIEW FROM INSIDE THE CENSUS BUREAU VAULTS (2009) Downloads
Working Paper: Using the P90/P10 Index to Measure U.S. Inequality Trends with Current Population Survey Data: A View From Inside the Census Bureau Vaults (2007) Downloads
Working Paper: Using the P90/P10 index to measure US inquality trends with current population survey data: a view from inside the Census Bureau vaults (2007) Downloads
Working Paper: Using the P90/P10 Index to Measure US Inequality Trends with Current Population Survey Data: A View from Inside the Census Bureau Vaults* (2007) Downloads
Working Paper: Using the P90/P10 Index to Measure US Inequality Trends with Current Population Survey Data: A View from Inside the Census Bureau Vaults (2007) Downloads
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