In the wake of the Great Recession, Occupy Wall Street—and, more recently, Bernie Sanders’s presidential campaign—helped popularize the idea of the “one percent,” or the top percentile of earners in the U.S. who have captured a disproportionate share of economic gains for the last several decades. As economic inequality continues to grow, social scientists have sought to explain why the richest households in the country are increasingly pulling away from the rest of society. Researchers such as Thomas Piketty and Emmanuel Saez have attributed part of the spike in income inequality to the emergence of “supermanagers,” or exorbitantly compensated executives who make up to 1,000 times the median worker’s salary. Others, such as the authors in RSF’s issue on wealth inequality, have focused on the widening wealth gap between the rich and the middle class.
In a recent report published in Research in Social Stratification and Mobility, RSF grantee Lisa A. Keister and Hang Young Lee (Duke University) investigate the “double one percent,” or the households at the top of both the wealth distribution and the income distribution. Using data from the Survey of Consumer Finances (SCF), they analyze the top one percent of households in both income and net worth and find that about half of all households that belong to one one category also belong to the other. As the figure below shows, while the size of this “overlap” has varied over time, it has rarely diverged significantly from one-half since 1989:
The relatively stable size of this “double one percent” over time shows that income and wealth are interconnected and must be considered together for a complete picture of the concentration of resources in the U.S. today. In looking further at the households that fall in the double one percent, the authors find that these households tend to receive higher median incomes than those who are in the top one percent by income only. They also have higher median net worth than the households in the top one percent by net worth only. In other words, not only do these “super elites” enjoy both high incomes and net worth, but these resources reinforce and amplify each other. As the authors note, the exceptionally advantaged financial profile of the double one percent “underscores the point that identifying households by only their income or net worth risks omitting many households and potentially misrepresenting the extent to which financial resources are concentrated.”