What jobs do the 1% have? by Bajika, Cole, and Heim

BCH and the US government did all the work here. My only contribution was to highlight

1. professions I didn’t expect to see like pilot, farmer, government, teacher
2. some “standard narratives”:
• the one about “lawyers and doctors”
• (I don’t know why these two get grouped together, since one works in abstractions and the other works in gore…but whatever, that is a narrative)
• the one about “study hard and you’ll get ahead” (scientists, professors, computer, maths)
• and “real estate developers”

Obviously the top 1.5M earners aren’t important to the exclusion of the other 311M Estadounidenses, the 145M employed Estadounidenses, or everyone else.

Equally obvious is that

$\dpi{200} \bg_white \large \Pr\{ \texttt{lawyer} | \rm{you} \in {1 \over 100} \} \not= \Pr \{{1 \over 100} \ni \rm{you} | \texttt{lawyer} \}$

(some lawyerly deeds are more lucrative than others … same for doctors.)

Still, if you’re

• choosing a career
• trying to understand how the world works

then you might want to find out about rich people. It might be better to do so with, you know, actual facts, rather than for example listening to a bunch of programmers b*tch about how much money lawyers and doctors make.

Back to Bajika Cole & Heim. Why is it that this basic information wasn’t known? BCH, Pikkety Saez, and a few others who have bothered to parse data to answer simple questions seem to get fairly good citations. Are economics researchers so bent on complicated research that they won’t “arb” citations by doing something a non-PhD could do?

It is well known that the share of US income going to the top percentiles has increased dramatically over 1986–2006.  Piketty and Saez found that the top ¹⁄1000’s share of pre-tax income (ex cap gains) in the United States that was received by the top ¹⁄1000 rose from 2.2% to 8.0%.

But we don’t know what these people typically do for a living. Kaplan and Rauh (2010) looked through publicly-available information on top executives of publicly-traded firms, financial professionals, law partners, and professional athletes and celebrities. Despite making various extrapolations beyond what is directly available in publicly-available data sources, they were only able to identify the occupations of 17% of the top ¹⁄1000 of income earners.

We tabulated individual income tax return data from the U.S.Treasury Department on what share of top income earners work in each type of occupation. Through this method we are able to account for the occupations of almost all top earners – for example, for over 99% of primary taxpayers in the top ¹⁄1000.

(I liberally edited without [] or ….)

They also looked at spouses of the well-paid, computed income shares, computed growth rates, and broke down the incomes into

• 1% ex ½% (rank 1,500,000–750,000)
• ½% ex 0.1% (rank 750,000–150,000)
• 0.1% (rank 150,000–1)

. All of this is at the end of the PDF, after the bibliography.

Anyway let’s give BCH a hand for providing us with useful information.

"Theory is easy. Data are hard."

(Source: web.williams.edu)

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