The paper uses a combination of micro-level datasets to document the rise of income polarization-what some have referred to as the 'hollowing out' of the income distribution-in the United States, since the 1970s. While in the initial decades more middle-income households moved up, rather than...

Data show that middle-income households have continued moving down, and less so up, the income distribution in the United States since the 1970s-a phenomenon that is often referred to as the polarization or 'hollowing out' of the income distribution. While the level of income polarization is...

Although the majority of research on US income inequality trends is based on public-use March CPS data, a new wave of research using IRS tax return data reports substantially higher levels of inequality and faster growing trends. We show that these apparently inconsistent estimates are largely...