Talk:Household income in the United States

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Contents 1 Featured on... 2 International Comparisons 2.1 Swiss Data 3 Aussie data 4 References 5 Spelling and GA 6 Middle Class 7 Aggregate income distribution Chart 8 Expanded Definition of Household Income 9 Two year data? 10 History 11 Trimming 12 Math Problems

[edit] Featured on...

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[edit] International Comparisons

This section needs tidying up - the current definition of urban/rural England, for instance, is one that is not typically used at all in the UK - as you can see it was a response to a parliamentary question. There are better figures available for the UK as a whole. Plus, the Big Mac index is not a great way of measuring the the PPP of the UK/USA as various other goods are cheaper in the UK - e.g. private healthcare, education supplies, banking services etc. It'd be prudent to look for a better measure, which will likely be close to the current one, but less prone to being rejected.

Indeed it is very difficult to compare actual private income, not GDP per capita, on a global basis. Only Canada has something called median household income. I have gone through statistics from Germany, Sweden, Denmark and the Neatherlands all of whom have a similar standard of living to the US. My efforts have, however, yielded few useful results. Adding to the problem is of course the fact that comparing the US to say the UK or Denmark, means comparing a relative non-well-fare state country to a well-fare state. Neither the Big Mac index nor PPP were intendet for any comparison like the one I have attmpted to conduct. I am very close to replacing the current section with a section featuring only a US/Canadian comparision and a more global comparison of gini indexes that is to serve as an indicator for global trends regarding income distribution. Best Regards, Signature^brendelNow under review! 01:31, 18 November 2006 (UTC)

Brendel your data for median family income in Germany seems suspicious, i.e $45000 PPP in the year 2000. Perhaps there is some confusion between median household income and average household income (=$45000 in 2003)? Regards, Badenoch ~~Badenoch~~

I changed the statistics back to converted purchasing power form, because obviously they weren't that way. It said $39,000 for the UK when in reality it is $28,000. It's $39,000 when you use the exchange rate. And don't tell me that PPP doesn't take into account cheaper things in the UK, because in general, the US is a cheaper country to live in. Also, the previous German number does not make sense, for it was too high given other statistics I have available.

-Lee Dear Lee. The data was already expressed as PPP. I have to go now, but later I will write the full process out clearly in the discussion so that everyone can understand how these are calculated. Best wishes, Badenoch.

Badenoch, the German data comes from a source you gave me. If you have second thought about that info, two or three countries in the Comparison are enough-so we can remove "suspicous seeming data.
Lee, The median household income according to any source I a have available suggests that $39k is correct for the UK, whereas $28k seems awfully low, considering the median household income of Canada (a fellow well-fare state) and Australia. PS. sign your posts w/ ~~~~. Best Regards, Signature^brendelHAPPY HOLIDAYS 04:18, 4 January 2007 (UTC)

Brendel, Lee and Others.

There are many traps with trying to obtain a valid comparison of international median household incomes. May I suggest that we use an agreed procedure to ensure quality control?

1. For consistency could we use gross (pre-tax) median household income adjusted for purchasing power parity (OECD). This allows the reader to make a direct comparison with the data for US States, which has been displayed in the subsequent section.

2. Avoid presenting equivalised data. This has been adjusted for household size and composition.

3. Avoid presenting net median household income, because this has had tax removed.

4. Avoid any confusion between average incomes and median incomes.

Converting from national currency units to US$ PPP is relatively straightforward. May I suggest that we use PPP rates from the OECD because they specialize in providing the best estimate for advanced economies. CIA and IMF PPP rates are effective in situations when comparing all countries, such as in the World Factbook, but less accurate for comparing advanced economies.

Country	Median household income national currency units	PPP rate (OECD)	Median houshold income (PPP)
Switzerland.[1]	Francs 96,000	1.34	$72.000
United States	US$46,000	1.00	$46,000
Canada. [2]	estimated CAN$53,528	1.25	estimated $43,000
New Zealand. [3]	NZ$58,708	1.47	$40,000
United Kingdom. [4]	GBR£24,700	0.631	$39,000
Scotland[5]	GBR£24,128	0.631	$38,000
Ireland	€35,410	1.00	$35,000
Australia.[6]	AUS$46,326	1.36	$35,000

Canada's data was estimated in the following way: In the year 2000 the median household income was 80% of the average household income .^[7]Assuming that the distribution between the average and the median is still similar in 2006, then it is possible to estimate the median household income from the average household income for 2006. Canada new census data will soon become available, which will provide the best measure of median household income.

For Germany we know the average household income is US$45,000, but we have no knowledge of the distribution so it impossible to make a good estimate. I would GUESS that the distribution is similar to Canada because they are both socialist countries. This implies a median household income of US$36,000, but guestimates are too rough to put in the main page. I recommend not reporting German data until more information is available.

Best wishes, Badenoch

-The £24,700 number for median household income seems iffy. Take a look at this

link: [[1]]

There is nothing remotely close to that number you gave. With all the numbers crunched up, a the median household income works out to about £18,700. This works out to around $28-30k PPP. I know you may be surprised by how low this is, but then again why are you? The UK is one of the most expensive countries in the world! Canada by contrast not only has a higher GDP per capita, but has many more natural resources and much more affordable housing. So again, this is directly from the Parliament. The link that I provide does not indicate that it is after tax. I used "before housing" statistics.

Lee

-Another thing we can't forget is the size of the household. The median household in the US tends to have less people in it due to the fact that children tend to leave house much earlier than in Europe. Makes a huge difference.

Lee

Dear Lee, Your link was for equivalised median household income. Can we please agree not to quote data that has been equivalised[[2]] , otherwise it becomes impossible to compare the data with the USA? Best wishes, Badenoch

Dear Badenoch, what I got from "equivalised" was adjusted for inflation, which is consistent with the US statistics. Equivalised need not mean after tax, or does it?

I agree w/ Badenoch's suggestions above. Comapring developed economies is quite difficult and trying to abstain from using equalised data seesm like a good idea even if it makes the comparison table harder to read. Also lets remember that all US figures in the articles are gross (pre-tax) annual household income. As for the inflation issue, perhaps we should aim to find data for the same year. I have median household income data for the US available for nearly every year. To aviod the inflation pitfalls we should use data coming from the same year. Regards, Signature^brendelHAPPY HOLIDAYS 15:38, 4 January 2007 (UTC)

No Lee, equivalised does not mean inflation adjusted and "yes" equivalised is normally presented as net (after-tax) income. "Equivalised" Income is used to allow comparisons of living standards between different household types. Income is adjusted to take into account variations in the size and composition of the household. This adjustment reflects the fact that a family of several people requires a higher income than a single person in order for both households to enjoy a comparable standard of living. The key assumption is that all individuals in the household benefit equally from the combined (equivalised) income of the household. There are distinct equivalence scales used for income before housing costs (BHC) and income after housing costs (AHC).

There are three reasons to avoid using equivalised data:

1. Most readers don't understand what equivalised means. They know their own household income but their equivalised household income. We shouldn't deliberately confuse the reader.

2. Equivalised data is normally after-tax. There are big differences between tax systems. For example, some countries pay for tertiary education through taxation, while others pay through private savings. The same argument applies to other cost such as health and retirement costs. Using gross income allows a direct comparison between countries with different taxation systems.

3. The main subject of this page is "Household income in the United States". There are already hundreds of data entries that are not equivalised. If we switch to using equivalised data we will have no data for the USA, and nothing to discuss.

So please lets keep it simple and just avoid using equivalised data.

Best wishes, Badenoch

I agree we should abstain from using equivalised data This article deals with gross household income in US as its main subject and only that data should make it into the international comparison section: Gross annual household income. Equivalised net income data needs to be discussed in another article. We are effectively not discussing the standard of living among developed nations (see Standard of living for that discussion). The sole purpose of this section is to simply give readers a reference point for all the US-specific data. PS. Please, you have to sign your posts w/ ~~~~ Best Regards, Signature^brendelHAPPY HOLIDAYS 22:01, 4 January 2007 (UTC)

-I found statistics for Spain and Germany. For Spain it is mean household income and for Germany mean household income, as well. Can we guess what the median is using a mathematical correlation from other countries?

I have found the mean for Germany as well but we cannot guess. There is Wikipedia policy that prohibits "Original Research." If we conduct a guess using a mathematical correlation from other countries this article could lose its [[WP:Good article}Good article status]]. So, sorry we can't do that. Regards, Signature^brendelHAPPY HOLIDAYS 19:17, 5 January 2007 (UTC)

I agree with Brendel. We should not try estimate the median household income based on the distribution in other countries. The relationship between mean and median varies a lot from country-to-country, so the error could potentially be very high. Regards BadenochBadenoch 16:55, 6 January 2007 (UTC)

Ireland's data (see table above) was provided via email by Kathryn Carty who works at Ireland's Central Statistics Office. Thank you Kathryn. Badenoch 04:42, 19 January 2007 (UTC)

Thanks! I'm still looking for some Scandinavian data. Regards, Signature^brendel 20:11, 19 January 2007 (UTC)

[edit] Swiss Data

I just found the median household income for Switzerland in 2003 here. According to the Swiss Gov it's 8,000 francs per month, 96,000 francs per year.

Hi Brendel, Could we convert using PPP rates as these don't fluctuate with exchange rates and are a better comparison. Most of this data can be found here. Please use the data for the corresponding year if possible. For example, in 2003 Switzerlands PPP rate was 1.76. Overall Swiss median household income = 7981CHF x 12 / 1.76 = $54,000.

Sure thing. Before I used a converter from the Economist. Signature^brendel 19:04, 20 January 2007 (UTC)

Singapore

For non-OECD countries such as Singapore could we use the IMF PPP rates? 2005 data for singapore is available here. The IMF PPP rate for that year = 1.552. Overall Singapore's median household income = 3830 x 12 / 1.552 = 30,000 Badenoch 18:34, 20 January 2007 (UTC)

Again, I used the economist. Regards, Signature^brendel 19:04, 20 January 2007 (UTC)

Was that the economist Big Mac Index? From memory, I think the OECD use over 2000 items, which adds to the accuracy. I've got to now, but you have a good weekend and good luck with your search for new data. Badenoch 19:28, 20 January 2007 (UTC)

I beleive it was. Have a good weekend and thanks for your help! Signature^brendel 19:37, 20 January 2007 (UTC)

[edit] Aussie data

I have just been reading the new 2007 Australian Year book (page 195) and noticed the median household income for Australia was incorrectly reported in the international comparison. I will fix it. Badenoch 18:47, 30 January 2007 (UTC)

What difference- if the previous figure was indeed wrong than we made quite the mistake ;-) What was wrong with the revious source- did we confuse mean and median income? Anyways, Thanks for fixing it! Signature^brendel 19:10, 30 January 2007 (UTC)

I am unable to account for the difference in reported income. The original data was for median gross household income (see link[[3]] page 49). However I think the yearbook data is more likely to be the correct value. Badenoch 19:39, 31 January 2007 (UTC)

Australian state capital incomes presented in the latest demographia study[[4]] are similar to the incomes in the Australian yearbook. Therefore the yearbook is probably a more reliable source. Badenoch 20:17, 31 January 2007 (UTC)

Well if we have two sources indicating that $35k is the correct figure and only one source backing the $48k figure, we should go with the former has you have done. I am just amazed at the discrepency! Best Regards, Signature^brendel 05:47, 1 February 2007 (UTC)

[edit] References

[edit] Spelling and GA

• cough* housEhold Morwen - Talk 20:11, 29 June 2006 (UTC)

Bravada fixed that. Thank for the hint though! Regards, Signature^brendel 03:43, 30 June 2006 (UTC)

I am on my best way to become a personal nemesis of yours, but I now have all those articles on my watchlist... I understand why you added the GA tag here, nevertheless the procedure is to let some other person NOT involved with the creation of the article judge whether this is a good article or not. This is not to say this is not a good article, but I believe this is a fair and sensible procedure, especially given how this article was created in its entirety within the past 24 hours. I guess such tagging would cause an unwanted precedent and further depreciation of the GA status - just imagine the multitude of users just adding "their" articles to the GA list... Bravada, talk - 03:31, 30 June 2006 (UTC)

Why nemesis, I value your opinion and really appreciate your contributions and professionalism, so why don't you add the GA tag then, once you think the article's good enough. Fair? Just please don't forget to do so ;-) (that's supposed to be funny) Signature^brendel 03:33, 30 June 2006 (UTC)

Sorry I actually didn't know that there's a nomination process. Regards, Signature^brendel 06:15, 1 July 2006 (UTC)

Well written and cited article. One comment regarding the GA nomination, the income distribution table and the aggregate income distribution table need to be fixed. There are some missing cells that are throwing them off.--NMajdan•talk 13:57, 17 July 2006 (UTC)

Okay, thank you. I'll fix them this evening. (Pacific Time\-8) Signature^brendel 15:40, 17 July 2006 (UTC)

[edit] Middle Class

The opening paragraph refers to middle class households and incomes, without defining what this means. Clearly it is not defined by income, as we are told that the middle class earn a disproportionate amount of money. Markb 09:45, 13 July 2006 (UTC)

The use of the term middle class is not in relation to social class here, I have changed the wording to reflect that. Here, middle class referes to middle class income. Surely you have heard that expression, it merely means that these households fall in the middle of the income spectrum. Regards, Signature^brendel 14:48, 13 July 2006 (UTC)

I dont see how 'middle class' can be used to describe the group of people on middle income when the article states that the middle class make up 29.2% of households yet earn 40% of the total income - this group clearly is in the upper 1/2 of households. Either define what you mean by 'middle-class' income or remove reference to it. Markb 08:22, 14 July 2006 (UTC)

It's the middle among family households which are most iconic of American life. I was trying to make the sheer volume of data more digestable by adding some interesting and engaging key terms, relying on common knowledge. I have now added the term "moderately high middle class" income, references through a USA Today article. Regards, Signature^brendel 15:10, 14 July 2006 (UTC)

Thanks. The term 'Middle Class' has quite a specific meaning in the UK, not just related to income (which tends to be above average), but also political and cultural. Typically, middle class is associated with 'professional' occupations - white-collar workers if you like, as opposed to blue-collars workers (working-class). There are always exceptions, such as the high-earning tradesman (plumber) compared to the relatively low-income teacher. The former would consider themselves working class while the latter middle-class. Hence using such a term can be quite confusing! Markb 18:18, 15 July 2006 (UTC)

Yes there is indeed a difference between the meaning of middle class in the US and in the UK. Here in the US its mostly based on money. But even in the US there is a big difference between what people perceive to be middle class and what actually is middle class. According to the Washington Press "The statistical middle class can no longer afford the middle-class lifestyle." - that confuses even a lot of Americans. Signature^brendel 18:22, 15 July 2006 (UTC)

[edit] Aggregate income distribution Chart

The article, as a whole, is excellent, though I noticed two minor things that may want to be fixed. The reference ([27]) for the Aggregate income distribution Chart seems to have been lost and because of this I was unable to look up the information needed to fix the chart. The Chart lists income groups as follows:

less than $25,000; 25,000 to $50,000; $50,000 to $75,000; $75,000 to $100,000; $150,000 or more;

As you can see there is no $100,000 to $150,000 group. Because of the associated percentages I would guess that the last category should be $100,000 or more, but because I don't have a resource to verify this assumption I do not want to make the change, though thought I would point it out so that someone who was involved in the development of this page could fix it. 69.110.254.107 19:25, 30 July 2006 (UTC)

Thank you for the complitment. After I spent so much time writing this article I certainly appreicate it. Yes you are right, logically the next income group after $75k to $100k would be $100k to $150k. Unfortunately the aggregate income for this particular group is unavailable. The Census Bureau in its 2005 Economic Survey simply states "N/A" for this group; thus I don't have the data and left the group out of the graph. Regards, Signature^brendel 20:02, 30 July 2006 (UTC)

[edit] Expanded Definition of Household Income

Excellent, thorough article. Should be a featured article. I'd like to expand on the definition of "household income" as defined by the census but can't definitively come out and say it just yet, looking for a government source definition. I found the 2000 long form Census and it asks for Salary/Wages/Commissions (before deductions for taxes bonds or dues), non-farm self-employment income, interest/rental/royalty/estate/trust income, social security, SSI, state/local welfare transfers, retirement pensions, and VA/unemployment/alimony transfers.Prospero74 02:40, 18 August 2006 (UTC)

All the above mentioned are commonly included-as far as I know they make up "gross income." I do appreciate your research and please include any relevant info you can find-hope your research turns out successful. Also, this article is up for GA status and you can help! => Just click on the link above. Thank you. Best Regards, Signature^brendel 03:11, 18 August 2006 (UTC)

[edit] Two year data?

I got here over the link in the CA article infobox- how come the state stats are for BOTH 04 and 05. Are they two year averages? Cheers, AlpineNevada

The data was released in 2005 and gather regarding the year 2004. I'll change the citation label. BTW: Please sign your posts using ~~~~ Regards, Signature^brendel 07:07, 15 January 2007 (UTC)

[edit] History

Please help improve this article or section by expanding it. Further information might be found on the talk page or at requests for expansion. This article has been tagged since February 2007.

It would be nice to see some historical coverage, such as a chart of the Gini coefficient over time. -- Beland 01:10, 7 February 2007 (UTC)

The gini coefficient would be better placed on the Income inequality article, don't you think? Anyways, I will look into expanding the "Over time" section. Signature^brendel 01:21, 7 February 2007 (UTC)

I don't think so; that article discusses a number of different potential metrics in a global context. If you're look for United States-specific data, a U.S.-specific article would be where I'd expect to find it. Gini coefficient does have some overly U.S.-specific information, and Image:Gini since WWII.gif has more useful leads. It's unclear whether this information is per-household or per-person. It might not be a bad idea to start an "Income inequality in the United States" article and move some content there. This article is already 59K, which is about twice the recommended article length. -- Beland 17:26, 7 February 2007 (UTC)

Acutally starting a "Income inequality in the United States" article with info pertaining to persons as well as households is an excellent idea! I'm quite busy currently but should get around to it eventually (unless of course someone beats me to it ;-)). Best Regards, Signature^brendel 23:38, 7 February 2007 (UTC)

[edit] Trimming

This article is currently 57KB long, which is about twice the recommended size. Some of the problem is that it presents the same information more than once. I'm going to try to reduce such redundancy to streamline presentation for readers. -- Beland 19:19, 11 February 2007 (UTC)

• I'm removing Image:Income Strata 2005.jpg because there are other graphs that show the same information, although they have different thresholds. Moreover, it is confusing and hard to read. It is not sorted by income level as the legend is; instead, it is sorted by the size of the population in that level. This is non-intuitive and hard to tell because the colors are randomly assigned, rather than changing in hue e.g. from red to blue as income goes from lower to higher. -- Beland 19:19, 11 February 2007 (UTC)

• Image:Income Quintiles of White and Black Households.png is somewhat redundant. It's nice to see this data in graphical rather than purely numerical form, but this graph does that only for one ethnic/language group, rather than all four which you see in numerical data. I'm removing it for now. If another graph to replace it is created, it could show the data graphically for all groups, and the numerical chart could be moved from the article to the image description page of the graph. -- Beland 19:31, 11 February 2007 (UTC)

okay, but I think this article shouldn't be shorter than 45kb. I agree with your changes above and will probably create higher quality replacement graphs. The article probably does repeat the same info, that's why I do appreciate your feedback and copyediting. Signature^brendel 00:00, 12 February 2007 (UTC)

[edit] Math Problems

If the median income of males with a less than 9th grade education is $15,461 and of women is $9,296 how can the median income of both groups together be $17,422 more than either group individually. Isn't this mathematically impossible? 4.249.81.192 02:10, 29 March 2007 (UTC)