Surprise! The Poor(er) have been getting Rich(er)

The study, published in the National Tax Journal in 2009, and largely ignored by the mainstream press, found considerable mobility between income groups during the period 1987 to 2005 for the vast majority of workers. Using a sample of individuals aged between 25 and 64, the Treasury study found that 56 percent of those in the lowest income quintile at the beginning of the period had moved to a higher quintile 10 years later. Almost 30 percent went to the second quintile, and 27 percent moved up two or more quintiles. At the end of the 10-year period, 4.5 percent had moved to the top quintile. One of the reasons for moving to another quintile was marriage. As some move up, others move down. But the study found rising incomes overall. This is known as absolute mobility. During the period 1996 to 2005 median incomes of taxpayers rose by 24 percent after adjusting for inflation, with median incomes of those at the bottom increasing more than those at the top.

Is Economic Mobility in the US Dead?

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