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Abstract

Income inequality among Pennsylvania taxpayers has worsened over the past 30 years. Estimates of the Gini coefficient for total income made from tax bracket data compiled by the Pennsylvania Department of Revenue indicate that measured inequality increased by 7.5 percent between 1988 and 2018. While wages account for the large majority of income inequality in Pennsylvania, the major drivers of the documented increased inequality in taxpayer income since 1988 have been rising inequality in income from dividends including mutual fund distributions and net business profits.

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