This paper provides estimates of federal tax rates by income groups in the United States since 1960, with special emphasis on very top income groups. We include individual and corporate income taxes, ...payroll taxes, and estate and gift taxes. The progressivity of the U.S. federal tax system at the top of the income distribution has declined dramatically since the 1960s. This dramatic drop in progressivity is due primarily to a drop in corporate taxes and in estate and gift taxes combined with a sharp change in the composition of top incomes away from capital income and toward labor income. The sharp drop in statutory top marginal individual income tax rates has contributed only moderately to the decline in tax progressivity. International comparisons confirm that is it critical to take into account other taxes than the individual income tax to properly assess the extent of overall tax progressivity, both for time trends and for cross-country comparisons. The pattern for the United Kingdom is similar to the U.S. pattern. France had less progressive taxes than the United States or the United Kingdom in 1970 but has experienced an increase in tax progressivity and has now a more progressive tax system than the United States or the United Kingdom.
This paper summarizes the main findings and perspectives emerging from a collective research project on the dynamics of income and wealth distribution. The primary objective is to construct a ...high-quality, long-run, international database on income and wealth concentration, using historical tax statistics. In this database, the data are annual, long-run time series; they are fairly homogenous across countries; and they are also broken down by income source. Hence they offer a unique opportunity to understand the dynamics of income and wealth distribution and the interplay between inequality and growth.
This paper provides historical series on the evolution of the share of inherited wealth in aggregate private wealth in Europe (France, the UK, Germany, Sweden) and the USA over the 1900–2010 period. ...Until 1910, the inheritance share was very high in Europe (70–80%). It then fell abruptly following the 1914–45 shocks, down to about 30–40% during the 1950–80 period, and is back to 50–60% (and rising) since around 2010. The US pattern also appears to be U-shaped, albeit less marked, and with significant uncertainty regarding recent trends, due to data limitations. We discuss possible interpretations for these long-run patterns.
When a lengthy book is widely discussed in academic circles and the popular media, it is probably inevitable that the arguments of the book will be simplified in the telling and retelling. In the ...case of my book Capital in the Twenty-First Century (2014), a common simplification of the main theme is that because the rate of return on capital r exceeds the growth rate of the economy g, the inequality of wealth is destined to increase indefinitely over time. In my view, the magnitude of the gap between r and g is indeed one of the important forces that can explain historical magnitudes and variations in wealth inequality. However, I do not view r > g as the only or even the primary tool for considering changes in income and wealth in the 20th century, or for forecasting the path of income and wealth inequality in the 21st century. In this essay, I will take up several themes from my book that have perhaps become attenuated or garbled in the ongoing discussions of the book, and will seek to re-explain and re-frame these themes. First, I stress the key role played in my book by the interaction between beliefs systems, institutions, and the dynamics of inequality. Second, I briefly describe my multidimensional approach to the history of capital and inequality. Third, I review the relationship and differing causes between wealth inequality and income inequality. Fourth, I turn to the specific role of r > g in the dynamics of wealth inequality: specifically, a larger r − g gap will amplify the steady-state inequality of a wealth distribution that arises out of a given mixture of shocks. Fifth, I consider some of the scenarios that affect how r − g might evolve in the 21st century, including rising international tax competition, a growth slowdown, and differential access by the wealthy to higher returns on capital. Finally, I seek to clarify what is distinctive in my historical and political economy approach to institutions and inequality dynamics, and the complementarity with other approaches.
Dans cette conférence inédite, Thomas Piketty présente une synthèse de ses recherches historiques et comparatives sur les inégalités. Abordant des thèmes aussi variés que l’éducation, l’héritage, la ...crise climatique, la taxation des richesses ou les inégalités de genre, il bat en brèche l’idée qu’il pourrait exister des inégalités naturelles et montre que la marche vers l’égalité se construit toujours par des luttes politique et sociales.
Abstract
In this paper, we mobilize newly available historical series from the World Inequality Database to construct world income distribution estimates from 1820 to 2020. We find that the level of ...global income inequality has always been very large, reflecting the persistence of a highly hierarchical world economic system. Global inequality increased between 1820 and 1910, in the context of the rise of Western dominance and colonial empires, and then stabilized at a very high level between 1910 and 2020. Between 1820 and 1910, both between-countries and within-countries inequality were increasing. In contrast, these two components of global inequality have moved separately between 1910 and 2020: Within-countries inequality dropped in 1910–1980 (while between-countries inequality kept increasing) but rose in 1980–2020 (while between-countries inequality started to decline). As a consequence of these contradictory and compensating evolutions, early 21st century neo-colonial capitalism involves similar levels of inequality as early 20th century colonial capitalism, though it is based on a different set of rules and institutions. We also discuss how alternative rules such as fiscal revenue sharing could lead to a significant drop in global inequality. (JEL: N30, O10, O40)
This paper derives optimal inheritance tax formulas that capture the key equity-efficiency trade-off, are expressed in terms of estimable sufficient statistics, and are robust to the underlying ...structure of preferences. We consider dynamic stochastic models with general and heterogeneous bequest tastes and labor productivities. We limit ourselves to simple but realistic linear or two-bracket tax structures to obtain tractable formulas. We show that long-run optimal inheritance tax rates can always be expressed in terms of aggregate earnings and bequest elasticities with respect to tax rates, distributional parameters, and social preferences for redistribution. Those results carry over with tractable modifications to (a) the case with social discounting (instead of steady-state welfare maximization), (b) the case with partly accidental bequests, (c) the standard Barro—Becker dynastic model. The optimal tax rate is positive and quantitatively large if the elasticity of bequests to the tax rate is low, bequest concentration is high, and society cares mostly about those receiving little inheritance. We propose a calibration using micro-data for France and the United States. We find that, for realistic parameters, the optimal inheritance tax rate might be as large as 50%—60%—or even higher for top bequests, in line with historical experience.
DISTRIBUTIONAL NATIONAL ACCOUNTS Piketty, Thomas; Saez, Emmanuel; Zucman, Gabriel
The Quarterly journal of economics,
05/2018, Letnik:
133, Številka:
2
Journal Article
Recenzirano
Odprti dostop
This article combines tax, survey, and national accounts data to estimate the distribution of national income in the United States since 1913. Our distributional national accounts capture 100% of ...national income, allowing us to compute growth rates for each quantile of the income distribution consistent with macroeconomic growth. We estimate the distribution of both pretax and posttax income, making it possible to provide a comprehensive view of how government redistribution affects inequality. Average pretax real national income per adult has increased 60% from 1980 to 2014, but we find that it has stagnated for the bottom 50% of the distribution at about $16,000 a year. The pretax income of the middle class—adults between the median and the 90th percentile—has grown 40% since 1980, faster than what tax and survey data suggest, due in particular to the rise of tax-exempt fringe benefits. Income has boomed at the top. The upsurge of top incomes was first a labor income phenomenon but has mostly been a capital income phenomenon since 2000. The government has offset only a small fraction of the increase in inequality. The reduction of the gender gap in earnings has mitigated the increase in inequality among adults, but the share of women falls steeply as one moves up the labor income distribution, and is only 11% in the top 0.1% in 2014.
Thomas Piketty discusses his book, "Capital in the Twenty-First Century: A Multidimensional Approach to the History of Capital and Social Classes," and what he set to accomplish with his work.
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