Public economics

Physics

Income inequality metrics

Sociology

Archaeology

Recession

Demographics

Household income

Mathematics

Demographic economics

State income tax

Macroeconomics

Labour economics

Demography

Mathematical analysis

Comprehensive income

Predictability

Economics

Geography

Gross income

Inequality

Economic inequality

Quantum mechanics

Income distribution

Tax reform

Quantitative Economics

In this paper, we use administrative data from the social security to study income dynamics and income risk inequality in Spain between 2005 and 2018. We construct individual measures of income risk as functions of past employment history, income, and demographics. Focusing on males, we document that income risk is highly unequal in Spain: More than half of the economy has close to perfect predictability of their income, while some face considerable uncertainty. Income risk is inversely related to income and age, and income risk inequality increases markedly in the recession. These findings are robust to a variety of specifications, including using neural networks for prediction and allowing for individual unobserved heterogeneity.

Income risk inequality: Evidence from Spanish administrative records