Top incomes and earnings in Portugal 1936-2004

This paper analyzes income and earnings concentration in Portugal from a long-run perspective using personal income and wage tax statistics. Our results suggest that income concentration was much higher during the 1930s and early 1940s than it is today. Top income shares estimated from reported incomes deteriorated during the Second World War, even if Portugal did not take active participation in the conflict. However, the magnitude of the drop was less important than in other European countries. The level of concentration between 1950 and 1970 remained relatively high compared to countries such as Spain, France, UK or the United States. The decrease in income concentration, started very moderately at the end of the 1960s and which accelerated after the revolution of 1974, began to be reversed during the first half of the 1980s. During the last fifteen years top income shares have increased steadily. The rise in wage concentration contributed to this process in a significant way. The evidence since 1989 suggests that the level of marginal tax rate at the top has not been the primary determinant of the level of top reported incomes. Marginal rates have stayed constant in a context of growing top shares.top incomes ; top wages ; concentration ; Portugal

Income and wealth concentration in Spain in a historical and fiscal perspective

This paper presents series on top shares of income and wealth in Spain over the 20th century using personal income and wealth tax return statistics. Top income shares are highest in the 1930s, fall sharply during the first two decades of the Franco dictatorship, and have increased slightly since the 1960s, and especially since the mid-1990s. The top 0.01% income share in Spain estimated from income tax data is comparable to estimates for the United States and France over the period 1933-1971. Those findings, along with a careful analysis of all published tax statistics, suggest that income tax evasion and avoidance among top income earners in Spain before 1980 was much less prevalent than previously thought. Wealth concentration has been about stable from 1982 to 2004 as surging real estate prices have benefited the middle class and compensated for a slight increase in financial wealth concentration in the 1990s. We use our wealth series and a simple conceptual model to analyse the effects of the wealth tax exemption of stocks for ownersmanagers introduced in 1994. We show that the reform induced substantial shifting from the taxable to tax exempt status. This shifting has eroded the wealth tax base substantially and hence the tax exemption has generated large efficiency costs.income concentration ; top incomes ; behavioral response

Top incomes and earnings in Portugal 1936-2004

This paper analyzes income and earnings concentration in Portugal from a long-run perspective using personal income and wage tax statistics. Our results suggest that income concentration was much higher during the 1930s and early 1940s than it is today. Top income shares estimated from reported incomes deteriorated during the Second World War, even if Portugal did not take active participation in the conflict. However, the magnitude of the drop was less important than in other European countries. The level of concentration between 1950 and 1970 remained relatively high compared to countries such as Spain, France, UK or the United States. The decrease in income concentration, started very moderately at the end of the 1960s and which accelerated after the revolution of 1974, began to be reversed during the first half of the 1980s. During the last fifteen years top income shares have increased steadily. The rise in wage concentration contributed to this process in a significant way. The evidence since 1989 suggests that the level of marginal tax rate at the top has not been the primary determinant of the level of top reported incomes. Marginal rates have stayed constant in a context of growing top shares.Ce travail présente des séries sur les hauts revenus et les hauts salaires en Portugal entre 1936 et 2004, construites à partir de données fiscales et fichiers administratifs.Le Portugal est un cas spécial de pays doté d'une structure bureaucratique bien organisée en ce qui concerne l'imposition sur le revenu, influencée par la stabilité du régime autoritaire au pouvoir entre 1926 et 1974. Les dossiers administratifs et les données étaient régulièrement publiés depuis 1936. Malheureusement, ces archives et données présentent un blanc entre 1983 et 1988, une période durant laquelle de nombreuses réformes fiscales ont été introduites, ainsi que la transition entre l'ancien et le nouvel impôt sur le revenu réalisée en 1989. Les résultats montrent une relative stabilité des parts des hauts revenus entre la fin de la seconde Guerre mondiale et la fin des années 1960, suivie de dynamiques en forme de U, le bras ascendant du U apparaissant à partir du début des années 1980 quand les réformes ont été introduites afin de satisfaire aux conditions d'accession à la Communauté Economique Européenne. Des données-micro disponibles concernant les salaires mettent aussi à jour une augmentation de la part des hauts salaires

Top incomes and earnings in Portugal 1936-2004

This paper analyzes income and earnings concentration in Portugal from a long-run perspective using personal income and wage tax statistics. Our results suggest that income concentration was much higher during the 1930s and early 1940s than it is today. Top income shares estimated from reported incomes deteriorated during the Second World War, even if Portugal did not take active participation in the conflict. However, the magnitude of the drop was less important than in other European countries. The level of concentration between 1950 and 1970 remained relatively high compared to countries such as Spain, France, UK or the United States. The decrease in income concentration, started very moderately at the end of the 1960s and which accelerated after the revolution of 1974, began to be reversed during the first half of the 1980s. During the last fifteen years top income shares have increased steadily. The rise in wage concentration contributed to this process in a significant way. The evidence since 1989 suggests that the level of marginal tax rate at the top has not been the primary determinant of the level of top reported incomes. Marginal rates have stayed constant in a context of growing top shares.Ce travail présente des séries sur les hauts revenus et les hauts salaires en Portugal entre 1936 et 2004, construites à partir de données fiscales et fichiers administratifs.Le Portugal est un cas spécial de pays doté d'une structure bureaucratique bien organisée en ce qui concerne l'imposition sur le revenu, influencée par la stabilité du régime autoritaire au pouvoir entre 1926 et 1974. Les dossiers administratifs et les données étaient régulièrement publiés depuis 1936. Malheureusement, ces archives et données présentent un blanc entre 1983 et 1988, une période durant laquelle de nombreuses réformes fiscales ont été introduites, ainsi que la transition entre l'ancien et le nouvel impôt sur le revenu réalisée en 1989. Les résultats montrent une relative stabilité des parts des hauts revenus entre la fin de la seconde Guerre mondiale et la fin des années 1960, suivie de dynamiques en forme de U, le bras ascendant du U apparaissant à partir du début des années 1980 quand les réformes ont été introduites afin de satisfaire aux conditions d'accession à la Communauté Economique Européenne. Des données-micro disponibles concernant les salaires mettent aussi à jour une augmentation de la part des hauts salaires

The Rich in Argentina over the twentieth century: From the Conservative Republic to the Peronist experience and beyond 1932-2004

This paper presents series on top shares of income in Argentina from 1932 to 2004 based on personal income tax return statistics. Our results suggest that income concentration was higher during the 1930s and the first half of the 1940s than it is today. The recovery of the economy after the Great Depression, favored by the international trade conditions during and after the Second World War, and the visible effects of the peronist policy between 1945 and 1955 generated an inverted U shape in the dynamics of top shares. The peronist redistributive policy, successful and visible, seemed to have proved limited when compared with the central economies. Since then, and after a new upward movement between 1955 and 1959, the top shares seem to have described the U-shape pattern found in the developed English-speaking economies. The levels of concentration in 1953 were very similar to those found in 1997.income distribution ; top incomes ; taxation

Inequality over the Past Century

The share of income received by the top 1 percent of earners varied markedly between 1900 and 2008 in 24 developed and developing economies. Moreover, the biggest earners changed as well. When the century began, the top 1 percent was dominated by capital owners. By the end of the century the hired hands—the top executives—shared with capital owners the highest part of the income distribution.Fil: Gonzalez Alvaredo, Facundo. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentin

Recent trends in inequality and poverty in developing countries

This chapter reviews the empirical evidence on the levels and trends in income/consumption inequality and poverty in developing countries. It includes a discussion of data sources and measurement issues, evidence on the levels of inequality and poverty across countries and regions, an assessment of trends in these variables since the early 1980s, and a general discussion of their determinants. There has been tremendous progress in the measurement of inequality and poverty in the developing world, although serious problems of consistency and comparability still remain. The available evidence suggests that on average the levels of national income inequality in the developing world increased in the 1980s and 1990s, and declined in the 2000s. There was a remarkable fall in income poverty since the early 1980s, driven by the exceptional performance of China over the whole period, and the generalized improvement in living standards in all the regions of the developing world in the 2000s.Este trabajo corresponde al capítulo 10 de Handbook of Income Distribution, volume 2, editado por A. Atkinson y F. Bourguignon.Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS

Contribution Ceilings and the Incidence of Payroll Taxes

Social security contributions (SSCs) are typically formally split between employers and employees as payroll taxes, levied on earnings at a constant tax rate that applies only up to a ceiling, above which the marginal tax rate falls to a reduced rate, often 0. Such contribution ceilings create a concave kink point in the budget set of workers and hence should generate a dip in the distribution of earnings around the ceiling through labour supply responses (the reverse of bunching expected at convex kink points) but such a dip is not observed empirically. This paper sets out a new approach to infer the incidence of SSCs that exploits the absence of this dip and the fact that (mechanically) the distributions of labour cost (earnings inclusive of all payroll taxes), gross earnings (net of employer payroll taxes) and net earnings (net of both employer and employee payroll taxes) cannot all be smooth around a kink. The other papers in this special issue apply the method to data for Germany, France, the Netherlands and the UK and all find that distribution of gross earnings is smooth around kinks (implying that the distributions of labour costs and net-of-tax earnings are not) even though the concept of gross earnings is irrelevant in the standard static model of labour supply and demand that dominates the public economics literature. This suggests that other features of the labour market, such as wage bargaining based on the gross earnings concept, are relevant for determining the incidence of SSCs.Fil: Gonzalez Alvaredo, Facundo. Paris School of Economics; Francia. Consejo Nacional de Investigaciones Científicas y Técnicas; ArgentinaFil: Breda, Thomas. Paris School of Economics; FranciaFil: Roantree, Barra. Institute for Fiscal Studies; Reino UnidoFil: Saez, Emmanuel. University of California at Berkeley; Estados Unido

The Rich in Argentina over the twentieth century: From the Conservative Republic to the Peronist experience and beyond 1932-2004

This paper presents series on top shares of income in Argentina from 1932 to 2004 based on personal income tax return statistics. Our results suggest that income concentration was higher during the 1930s and the first half of the 1940s than it is today. The recovery of the economy after the Great Depression, favored by the international trade conditions during and after the Second World War, and the visible effects of the peronist policy between 1945 and 1955 generated an inverted U shape in the dynamics of top shares. The peronist redistributive policy, successful and visible, seemed to have proved limited when compared with the central economies. Since then, and after a new upward movement between 1955 and 1959, the top shares seem to have described the U-shape pattern found in the developed English-speaking economies. The levels of concentration in 1953 were very similar to those found in 1997.Ce travail présente des séries sur les hauts revenus en Argentine entre 1932 et 2004 construites à partir de données fiscales. Il apparaît que les niveaux de concentration durant les années trente et la première moitié des années quarante sont plus élevés qu'aujourd'hui. La Grande Dépression passée, l'économie est favorisée par les conditions du commerce international pendant et après la Seconde Guerre Mondiale ce qui crée une dynamique des hauts revenus en forme de U inversé. La comparaison des expériences économiques dans les différents pays développés met en évidence les limites de la politique de redistribution des deux premiers gouvernements péronistes, malgré leur grand succès auprès des classes ouvrières. Après une nouvelle période de croissance de 1955 à 1959, la dynamique des hauts revenus semble suivre un U semblable à celui trouvé dans les pays anglo-saxons. Les niveaux de concentration de 1997 sont très proches de ceux de 1953