Mark Price and Estelle Sommeiller’s new paper traces the trajectory of top incomes in American states and regions from 1917 through 2011. Mapping this data across the continental United States and over the last century suggests both important similarities across states, and some key differences.
On the map below, the states tip from green to red when the top 10 percent’s share of income exceeds one-third. In the early years, inequality (as measured by the high income share of top earners), is starkest in the Northeast. This inequality is generalized by the impact of depression and war in the 1930s and 1940s, but once the policy innovations of the New Deal (collective bargaining, retirement security, labor standards, and financial regulation) take hold, inequality eases: by the middle 1950s, only New York and the Deep South are still colored red.
The pattern across the last generation is just as telling. Of the sixteen states to top this threshold in 1972, the only ones outside the South were the tri-state home of big finance—New York, New Jersey, and Connecticut. As we scroll forward from there, the states in which the top 10 percent claim less than a third of total income gradually diminish, disappearing entirely by 1989. By 2011, the top 10 percent are claiming almost 60 percent of income in New York and Connecticut, and over 40 percent in all but three states (Iowa, Nebraska, and South Dakota).