Author(s)
Alejandro Badel, Moira Daly, Mark Huggett, Martin Nybom

We provide a common set of life-cycle earnings statistics based on administrative data from the United States, Canada, Denmark and Sweden. We find three qualitative patterns, which are common across countries. First, top-earnings inequality increases over the working lifetime. Second, the extreme right tail of the earnings distribution becomes thicker with age over the working lifetime. Third, top lifetime earners exhibit dramatically higher earnings growth over their working lifetime. Models of top earners should account for these three patterns and, importantly, for how they quantitatively differ across countries.

JEL Codes
D31: Personal Income, Wealth, and Their Distributions
D91: Intertemporal Consumer Choice; Life Cycle Models and Saving
H21: Taxation and Subsidies: Efficiency; Optimal Taxation
J31: Wage Level and Structure; Wage Differentials
Keywords
Earnings
inequality
top earners
top incomes