Despite the declining quality of income data: While overall income inequality rose over the past five decades, the rise in overall consumption inequality was small

Consumption and Income Inequality in the U.S. Since the 1960s Bruce D. Meyer and James X. Sullivan. Journal of Political Economy, June 28, 2022. https://doi.org/10.1086/721702

Abstract: Recent research concludes that the rise in consumption inequality mirrors, or even exceeds, the rise in income inequality. We revisit this finding, constructing improved measures of consumption, focusing on ints well measured components that are reported at a high and stable rate relative to national accounts. While overall income inequality rose over the past five decades, the rise in overall consumption inequality was small. The declining quality of income data likely contributes to these differences for the bottom of the distribution. Asset price changes likely account for some of the differences in recent years for the top of the distribution.

Previous version in 2017 (with a much longer abstract): Consumption and Income Inequality in the U.S. Since the 1960s. Bruce D. Meyer & James X. Sullivan. NBER Working Paper 23655. Aug 2017. https://www.bipartisanalliance.com/2017/08/consumption-and-income-inequality-in-us.html