Anthony Atkinson and Andrew Leigh have a working paper on the strikingly similar patterns in high-end income concentration in five English-speaking countries.
Here is their graph of the income shares of the top 1%:
and of those whose incomes put them between the 95th and 99th percentiles of the income distributions of their respective countries:
My understanding of this literature is that these trends are most pronounced in English-speaking countries (please correct me if I have this wrong), which begs the question of why this might be the case.
One story that suggests itself immediately is that of the 'brain drain'. If high-skilled workers in the various English-speaking countries could credibly threaten to move to the United States, then this outside option could be leveraged into ever-higher salaries for the people at the very top of the income distribution. Many people have their own anecdotes they can tell that would be consistent with this story.
A key element of this narrative is that the threat to leave is more credible for English speakers: moving to the US wouldn't mean abandoning their mother tongue. In particular, English-speaking Canadian migrants to the US have little difficulty adjusting to life in the US.
But there is a large sector of the Canadian population for whom the attractions of life in the US may be attenuated. Francophone Canadians know that moving to the US means abandoning their mother tongue and raising children in English. And for francophone Quebecers who grew up in a French-speaking environment, this may be a high cost to pay.
In their earlier study on Canadian top incomes, Mike Veall and Emmanuel Saez noted that the trends toward the concentration of incomes are markedly different for Quebecers who filed in French and for those who filed in English (an important caveat: some may have chosen not to file in their mother tongue). Here are the wage income shares for those who filed in French in Quebec, in English in Quebec, and for those who filed in the rest of Canada (source is the updated data set):
The incomes of those who filed in French in Quebec do not display the same trends as in the anglosphere. In fact, the trend toward the ever-higher concentration of income is most pronounced for English filers in Quebec. The brain drain story here would be that the threat to leave would be more credible for high-skilled anglophones than for francophones with equal skills.
Plausible as this story may be, it is not entirely convincing. When Mike Veall presented his updated numbers at the CEA meeting last weekend, he mentioned that he really didn't believe the brain drain story anymore. It turns out that Quebec isn't really that much of an outlier:
The concentration of high incomes in Canada is happening mainly in Ontario and especially in Alberta. We could presumably extend the narrative and claim that residents of (say) Atlantic Canada are greatly attached to their home provinces and cannot credibly threaten to leave, but this would greatly dilute the power of the original brain drain story.
Anyone got any better ideas?