Threshold Income

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Incomes Across the Distribution - Luxembourg Income Study Data Explorer
Explore Luxembourg Income Study data on the distribution of incomes.
Indicator
Decile thresholds
Decile
9 (richest)
Income measure
After tax
Period
Day
Month
Year
Adjust for cost sharing within households (equivalized income)
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Threshold income per year marking the richest decile (after tax), 2022
The level of income per year below which 90% of the population falls. Income here is measured after taxes and benefits.

World
No data
$0
$10,000
$20,000
$50,000
$100,000

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Data source: Luxembourg Income Study (2024) – Learn more about this data

Note: This data is measured in international-$ at 2017 prices to account for inflation and differences in the cost of living between countries.

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Richest decile (after tax)
The level of income per year below which 90% of the population falls.

Income is ‘post-tax’ — measured after taxes have been paid and most government benefits have been received.

Income is per capita, which means that household income is divided by the total number of household members.

The data is measured in international-$ at 2017 prices – this adjusts for inflation and for differences in the cost of living between countries.

NOTES ON HOW WE PROCESSED THIS INDICATOR

We create the Luxembourg Income Study data from standardized household survey microdata available in their LISSY platform. The estimations follow the methodology available in LIS, Key Figures and DART platform.

We obtain after tax income by using the disposable household income variable (dhi).

We estimate before tax income by calculating the sum of income from labor and capital (variable hifactor), cash transfers and in-kind goods and services from privates (hiprivate) and private pensions (hi33). We do this only for surveys where tax and contributions are fully captured, collected or imputed.

We convert income data from local currency into international-$ by dividing by the LIS PPP factor, available as an additional database in the LISSY platform.

We top and bottom-code incomes by replacing negative values with zeros and setting boundaries for extreme values of log income: at the top Q3 plus 3 times the interquartile range (Q3-Q1), and at the bottom Q1 minus 3 times the interquartile range.

We equivalize incomes by dividing each household observation by the square root of the number of household members (nhhmem). Per capita estimates are calculated by dividing incomes by the number of household members.

Income shares and thresholds by decile are obtained by using Stata’s sumdist function. We set weights as the product between the number of household members (nhhmem) and the normalized household weight (hwgt) and the number of quantile groups as 10. We estimate threshold ratios, share ratios and averages by decile in Python after processing in the LISSY platform.

Source
Luxembourg Income Study (2024) – processed by Our World in Data.