We examine trends in household disposable income inequality and potential mechanisms shaping inequality through changes to work, wages, earnings, marriage, and the tax and transfer system in the United States over the nearly five-decade period from 1975 to 2022. Overall after-tax and transfer income inequality increased more than 25 per cent since the mid-1970s, and by as much as 50 per cent when comparing the 90th and 10th percentiles.
We examine the contribution of the U.S. tax and social safety net to ameliorating racial and geographic household income gaps. Using nearly five decades of data from the Current Population Survey Annual Social and Economic Supplement, we make a comparative assessment of after-tax and transfer Black-White and rural-urban household income gaps in relation to similar gaps based solely on household earnings. Our results paint a mixed portrait of economic progress of Black and rural households relative to their White and urban counterparts over the last 50 years.