The spatial dimensions of top income concentration and income inequality in Italy

The study of income distribution and inequality at the national and global levels has a long tradition in economics. Yet, detailed distributional estimates at finer geographic levels remain scarce, despite their critical relevance for household wellbeing and policy intervention.

In this paper, Demetrio Guzzardi and Salvatore Morelli provide new insights into the spatial dimensions of top income concentration and income inequality in Italy for the first two decades of the twenty-first century. They leverage income tax records dating back to 1976 across the country’s regions, macro-areas, and the recently introduced classification of the National Strategy for Inner Areas (SNAI).

Key findings

• There has been a persistent rise in income concentration over the past few decades, particularly among the top earners. The top 0.1% nearly quadrupled their real income since 1976.
• There are nuanced regional and sub-regional dynamics. Larger cities experience a more pronounced level of income concentration compared to smaller ones.
• Although the Southern regions appear to be the most unequal when considering the top 10% income concentration, the Northern and Central regions appear more unequal when focusing on the top 1% and top 0.1%.
• There are large regional differences in average income and thresholds. In the North, one needs at least €515,275 to enter the richest 0.1% group, whereas the threshold is €160,230 in the South & Islands.
• There is a need to invest in statistical capacity to better represent income distribution in Italy using income tax files.

AUTHORS

• Demetrio Guzzardi, Institute of Economics and EMbeDS, Scuola Superiore Sant’Anna, WIL fellow
• Salvatore Morelli, University of Roma Tre, Stone Center on Socio-Economic Inequality, GC-CUNY, WIL fellow

CONTACT

• press@wid.world