The Center on Budget and Policy Priorities yesterday released Tax Data Show Richest 1% Took a Hit in 2008, But Income Remained Highly Concentrated at the Top; Recent Gains of Bottom 90% Wiped Out, by Hannah Shaw & Chad Stone:
An analysis of recently released IRS data on pre-tax income by economists Thomas Piketty and Emmanuel Saez [Striking it Richer: The Evolution of Top Incomes in the United States (Updated with 2008 estimates) (July 17, 2010)] shows that:
- The average income of the top 1% of households fell by 20% from 2007 to 2008, after adjusting for inflation, wiping out almost half of the gains this group achieved between 2002 and 2007 (see Figure 1).
Piketty and Saez’s unique data series on income inequality, based on IRS files, is particularly valuable because it provides detailed information on income gains at the top of the income scale and extends back to 1913. These data show that in the past decade, income concentration has reached levels last seen over 80 years ago.
