Inflation Inequality Across Time and Space in the United States

49 Pages Posted: 7 May 2024 Last revised: 1 Jun 2024

See all articles by Jonathan Hartley

Jonathan Hartley

Stanford University

Jackson Mejia

Massachusetts Institute of Technology (MIT)

Date Written: May 7, 2024

Abstract

We develop a new real-time dataset for analyzing wage and inflation inequality in the United States from 1978 onward at both monthly and annual frequencies. We give several examples of how to use our data for research at different levels of geographic aggregation. At the national level, we present three main findings. First, we find that inflation is typically slightly higher for low-income households, but that this seems to only hold in a fifteen year period between the late 1990s and 2012. Second, we investigate if increases in the aggregate inflation rate lead to more inflation inequality. The correlational evidence is weak. Third, we find mixed evidence in support of the view that inflation volatility is hump-shaped along the income distribution. Our more novel contribution is documenting extreme inflation inequality between the nine Census divisions divisions. The degree of geographic inflation inequality typically is typically twice as large as income-based national inflation inequality.

Keywords: Inflation, Prices, Distribution, Poverty

JEL Classification: E31

Suggested Citation

Hartley, Jonathan and Mejia, Jackson, Inflation Inequality Across Time and Space in the United States (May 7, 2024). Available at SSRN: https://ssrn.com/abstract=4818750 or http://dx.doi.org/10.2139/ssrn.4818750

Jonathan Hartley (Contact Author)

Stanford University ( email )

Stanford, CA
United States

HOME PAGE: http://www.jonathanhartley.net

Jackson Mejia

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

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