Correcting the Underestimation of Top Incomes: Combining Data from Income Tax Reports and the Brazilian 2010 Census

18 Pages Posted: 4 Apr 2016 Last revised: 5 Jun 2018

See all articles by Marcelo Medeiros

Marcelo Medeiros

IPEA - Institute for Applied Economic Research; UnB - University of Brasilia

Juliana Galvao

UnB

Luísa Nazareno

Universidade de Brasília (UnB) - Campus Universitario Darcy Ribeiro; Georgia State University - Andrew Young School of Policy Studies, Students

Date Written: August 24, 2016

Abstract

To deal with the problem of underestimation of top incomes in household surveys, we propose a methodology to combine the income distributions of the Brazilian 2010 Census (survey) and of 2010 DIRPF (personal income tax reports). The method consists on estimating a system of non-response weights that uses as frame the tax register and is applied to the top of the distribution. After applying this calibration methodology, we decompose inequality income sources. Correcting survey distributions with tax data increases the contribution of non-labor income to inequality, as the case of the Brazilian Census shows. Changes in the methodology do not affect the results substantially.

Keywords: Income inequality, Social stratification, Top incomes, Rich, Income tax

JEL Classification: D63

Suggested Citation

Medeiros, Marcelo and Galvao, Juliana and Nazareno, Luísa, Correcting the Underestimation of Top Incomes: Combining Data from Income Tax Reports and the Brazilian 2010 Census (August 24, 2016). Available at SSRN: https://ssrn.com/abstract=2756262 or http://dx.doi.org/10.2139/ssrn.2756262

Marcelo Medeiros (Contact Author)

IPEA - Institute for Applied Economic Research ( email )

SBS-01, Ed. BNDES
1610
Brasilia, DF 70076-900
Brazil

HOME PAGE: http://www.ipea.gov.br

UnB - University of Brasilia ( email )

Campus Universitário Darcy Ribeiro
Brasilia, Distrito Federal 70910-900
Brazil

HOME PAGE: http://buscatextual.cnpq.br/buscatextual/visualizacv.do?metodo=apresentar&id=K4798836T3

Juliana Galvao

UnB ( email )

Campus Universitário Darcy Ribeiro
Asa Norte
Brasília, Distrito Federal 70910-900
Brazil

Luísa Nazareno

Universidade de Brasília (UnB) - Campus Universitario Darcy Ribeiro ( email )

Campus Universitário Darcy Ribeiro
Brasilia, Distrito Federal 70910-900
Brazil

Georgia State University - Andrew Young School of Policy Studies, Students ( email )

GA
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
57
Abstract Views
543
rank
422,734
PlumX Metrics