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Article Dans Une Revue Review of Income and Wealth Année : 2022

Generalized Pareto Curves: Theory and Applications

Résumé

We define generalized Pareto curves as the curve of inverted Pareto coefficients b(p), where b(p) is the ratio between average income above rank p and the p-th quantile Q(p) (i.e., b(p)=E[X|X>Q(p)]/Q(p))). We use them to characterize income distributions. We develop a method to flexibly recover a continuous distribution based on tabulated income data as is generally available from tax authorities, which produces smooth and realistic shapes of generalized Pareto curves. Using detailed tabulations from quasi-exhaustive tax data, we show the precision of our method. It gives better results than the most commonly used interpolation techniques for the top half of the distribution.

Dates et versions

halshs-03760338 , version 1 (25-08-2022)

Licence

Paternité - Pas d'utilisation commerciale - Pas de modification

Identifiants

Citer

Thomas Blanchet, Juliette Fournier, Thomas Piketty. Generalized Pareto Curves: Theory and Applications. Review of Income and Wealth, 2022, 68 (1), pp.263-288. ⟨10.1111/roiw.12510⟩. ⟨halshs-03760338⟩
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