Top Incomes in Germany, 1871-2013

Diskussionspapiere extern , 62 S.

Charlotte Bartels

WID.world, 2017, 62 S.
(WID.world Working Paper Series ; 18)

Abstract

This study provides new homogeneous series on top income shares in Germany from the early phase of industrialization until present. German income tax statistics offer the unique possibility to go back as far as 1871 and produce series for eight German states ranging from heavily industrializing Prussia or Saxony to mostly agrarian Baden or Wurttemberg. Top income earners in Germany are mostly business owners who benefit from global demand for their goods. High income concentration of the industrialization period temporarily dropped in the 1920s, when hyperinflation eroded financial assets and exorbitant wage increases curtailed business profits, but then reached new heights under the Nazi regime. The German development is in contrast to other industrialized countries like France, the UK, and the US, where World War II brought a strong and lasting reduction in income concentration at the top. Since the turn of the millennium, top income shares in Germany are on the rise catching up with the levels of the UK and the US.

Charlotte Bartels

Wissenschaftliche Mitarbeiterin in der Infrastruktureinrichtung Sozio-oekonomisches Panel



JEL-Classification: D31;D63;J31;N30
Keywords: Income Inequality, Income Distribution, Top Incomes, Welfare State, Germany