EconPapers    
Economics at your fingertips  
 

Homoploutia: Top Labor and Capital Incomes in the United States, 1950-2020

Yonatan Berman and Branko Milanovic ()

No 806, LIS Working papers from LIS Cross-National Data Center in Luxembourg

Abstract: Homoploutia describes the situation in which the same people (homo) are wealthy (ploutia) in the space of capital and labor income in some country. It can be quantified by the share of capital-income rich who are also labor-income rich. In this paper we combine several datasets covering different time periods to document the evolution of homoploutia in the United States from 1950 to 2020. We find that homoploutia was low after World War II, has increased by the early 1960s, and then decreased until the mid-1980s. Since 1985 it has been sharply increasing: In 1985, about 17% of adults in the top decile of capital-income earners were also in the top decile of labor-income earners. In 2018 this indicator was about 30%. This makes the traditional division to capitalists and laborers less relevant today. It makes periods characterized by high interpersonal inequality, high capital-income ratio and high capital share of income in the past fundamentally different from the current situation. High homoploutia has far-reaching implications for social mobility and equality of opportunity. We also study how homoploutia is related to total income inequality. We find that rising homoploutia accounts for about 20% of the increase in total income inequality in the United States since 1986.

Pages: 31 pages
Date: 2020-12
New Economics Papers: this item is included in nep-his, nep-isf and nep-ltv
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed

Downloads: (external link)
http://www.lisdatacenter.org/wps/liswps/806.pdf (application/pdf)

Related works:
Working Paper: Homoploutia: Top Labor and Capital Incomes in the United States, 1950-2020 (2020) Downloads
Working Paper: Homoploutia: Top Labor and Capital Incomes in the United States, 1950-2020 (2020) Downloads
Working Paper: Homoploutia: Top Labor and Capital Incomes in the United States, 1950—2020 (2020) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:lis:liswps:806

Access Statistics for this paper

More papers in LIS Working papers from LIS Cross-National Data Center in Luxembourg Contact information at EDIRC.
Bibliographic data for series maintained by Piotr Paradowski ().

 
Page updated 2022-07-28
Handle: RePEc:lis:liswps:806