August 19, 2008

Richmond Fed's Economic Quarterly Examines the Evolution of U.S. Income Inequality

Richmond, VA

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On the Evolution of Income Inequality in the United States by Kevin A. Bryan and Leonardo Martinez

Income inequality in the United States has received considerable attention in recent policy debates. Richmond Fed economists Kevin A. Bryan and Leonardo Martinez find that income inequality has risen since the 1960s, and that this is explained mainly by increases in inequality at the top of the income distribution. In addition, they document periods characterized by a decline in real income for lower income groups. Bryan and Martinez also explain that welfare inequality may have increased less than income inequality and, in fact, may actually have decreased, due to changing trends in leisure consumption.

You can find the full text of this article and others in the latest issue of Economic Quarterly at the Bank's Web site.

Also in the Spring 2008 issue:

• On the Sources of Movements in Inflation Expectations: A Few Insights from a VAR Model by Yash P. Mehra and Christopher Herrington
• What is the Monetary Standard, Or, How Did the Volcker-Greenspan FOMCs Tame Inflation? by Robert L. Hetzel
• Limits to Redistribution and Intertemporal Wedges: Implications of Pareto Optimality with Private Information  by Borys Grochulski

The Economic Quarterly is a free publication containing economic analysis pertinent to Federal Reserve monetary and banking policy. For free copies or more information, contact the Federal Reserve Bank of Richmond’s Public Affairs office at 804.697.7982.

The Richmond Fed serves the Fifth Federal Reserve District, which includes the District of Columbia, Maryland, North Carolina, South Carolina, Virginia and most of West Virginia. As part of the nation's central bank, we're one of 12 regional Reserve Banks that work together with the Federal Reserve's Board of Governors to strengthen the economy and our communities. We manage the nation's money supply to keep inflation low and help the economy grow. We also supervise and regulate financial institutions to help safeguard our nation's financial system and protect the integrity and efficiency of our payments system.

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