Income Inequality General Knowledge

[EconomicNudity]

Just curious with all the discussion and opinions on income inequality how well people actually understand the basics...

I am taking a general survey here... Will share the results...

 

[EconomicNudity]

Interestingly after 16 have taken the survey, the best score is 6 out of 11 with the average around 25%. Just thought it would be interesting to know how much others know... Perhaps it is more difficult than it should have been.

 

[Kimura]

I got 10 out of 11. I knew #10, but I sort of zipped through it. And using the +/- by <insert>number</insert> was a little tricky.

 

[EconomicNudity]

I got 10 out of 11. I knew #10, but I sort of zipped through it. And using the +/- by <insert>number</insert> was a little tricky.

Very nice! That is the highest score thus far. Like I mentioned, it may be more difficult than I had meant for it to be. I really thought the questions were fairly introductory for those following the topic in detail. The average score is 35%. However, I have noticed many borderline answers. I tried to use the +/- to refrain from semantics and precision in the answers.

I want to post the answers but people are still consistently taking the quiz... As soon as activity dies down, I put the questions and answers up to get everyone's thoughts...

 

[georgephillip]

Welllllllll... I got 0% BUT I did manage to finish in less than five minutes.
Who knew inequality was this confusing?

 

[USNavyVet]

Very dumb questions. Waste of 5 minutes.

 

[georgephillip]

Very dumb questions. Waste of 5 minutes.

As much as I would like to agree with you, Vet, it is hard to debate a subject if, like myself. you don't know the fundamental aspects of the subject at hand.

 

[EconomicNudity]

Very dumb questions. Waste of 5 minutes.

I appreciate your perspective, but disagree.

Most people have an opinion, yet they cannot tell you the facts behind the data. The average score on the quiz was 30.83%. Kimura had the best score of 10/11. The next best were two 7/11's. I wasn't trying to trip anyone up with the questions.

A link to my post with the answers and links to their sources can be found here.

Quiz:
1. What is the definition of Income inequality?
a. Although wealth is often injected, the primary debate surrounds annual earnings. The popular Thomas Piketty book &#8220;Capital in the 21st Century&#8221; and his research focuses on household incomes from IRS tax data.
2. What are the most common sources used for income data?
a. The three primary sources used in the discussion are:
i. IRS tax data.
ii. Census Current Population Survey (CPS).
iii. CBO market income.
b. Each of the sources account for income slightly differently. Understanding these differences will assist in interpreting your findings.
3. How many individual tax returns were filed for 2012? (+/- 10 million)
a. 144,778,000 tax returns were filed in 2012.
4. How many individual tax returns make up the 1%? (+/- 100,000)
a. 1,447,780 (1% of 144,778,000)
5. What is currently considered poverty level income for a United Sates family of 4? (+/- $1,000)
a. $23,850 &#8211; U.S. Dept. of Health and Human Services
6. What levels of income are considered in the 80th percentile for all tax filers as of 2011? (+/- $5,000) (NOTE: This would mean you are in the top 20% of earners in the United States)
a. $97,298 &#8211; Tax Policy Center
7. How much income must be earned to be considered part of the 1% as of 2011?
a. $506,553
8. The Treasury Department conducted a study of income mobility from 1996-2005 (i.e. whether individuals tend to move into higher or lower income categories over time). What percentage of taxpayers beginning in the bottom 20% of earners in 1996 remained in the bottom 20% of earners in 2005? (+/- 5%)
a. Over the decade examined, 42.4% remained in the bottom 20% meaning 57.6 moved to a higher income quintile. 28.6% moved into the 2nd income quintile; 13.9 % moved into the middle income quintile; 9.9% moved into the 4th income quintile; while 5.3% moved into the top income quintile.
9. In the same Treasury Department study, how many earners in the top 1% income category in 1996 remained in the top 1% category in 2005? (+/- 5%)
a. 42.6% of top 1% earners in 1996 remained in the top 1% in 2005. 82.7 remained in the top 10% of earners in 2005.
10. What is the highest tax bracket in 2014? (+/- 1%)
a. 39.6%
11. What is the lowest tax bracket in 2014? (+/- 1%)
a. 10%

The reasoning behind the questions:

Question 1: The first questions was to identify the different elements of the discussion. Often people use data for income inequality to prove wealth inequality and vice versa. Though related, using data in this fashion only muddies the water and detracts from the discussion.

Question 2: People will quote information without an understanding of the differences between each collection method. Before-tax or after tax? How is income defined? etc.

Questions 3 & 4: It's interesting to me how little most know about the population used. Households, tax units, individuals, etc. I asked questions 3 & 4 simply to shed light on roughly how many make up the population and how many make up the 1%.

Question 5: I just thought I would shed light on those at the bottom quintile by identifying poverty levels.

Questions 6 & 7: What do we mean when we discuss the top 20%? A household income of $100k put you in this boat. At the same time, what does it take to be 1%? Piketty's figures are lower than the Tax Policy Center's $506,553.

Questions 8 & 9: How many in bottom remain in the bottom and how many in the top remain in the top? I thought this was a good informative question that would surprise most. 40% for both.

Questions 10 & 11: We seem eager and ready to increase taxes. I thought it would be interesting to see who could actually identify the top and bottom brackets... Most couldn't. That is not a knock on anyone. I just believe this is a relatively complex topic with many moving parts. There are many strong opinions based on loosely understood facts.