Income Mobility : The Recent American Experience

This paper examines the pattern of income mobility during the 1980s and the mid 1990s. It employs a panel of individual income tax returns for the years 1979 through 1995 to study this pattern, and explore whether income mobility has increased during the period. We focus on working age Americans, those age 30 and over in 1979, the first year of the panel, and up to age 61 in 1995, the last year of the panel. Consistent with other research, we find evidence of considerable mobility. For example, more than one-half of those in the bottom quintile move to a higher quintile over the period