| Abstract: | This paper explicitly defines two perspectives for investigating change: the longitudinal and the cross-sectional. After examining changes in male income between 1950 and 1970 by following cohorts through time, we identify a pattern of income changes with age which is quite different from that obtained in a cross-sectional analysis. On a longitudinal basis, it is evident that as men age to the retirement years that their income continually increases. A cross-sectional analysis leads to the conclusion that there is a decline in income during the latter working years. Two simple models (using change in the cost of living and productivity levels) are offered to help account for the patterns of income change. Although adjustments for varying costs of living and productivity levels slightly alter the pattern the two substantially different conclusions are not changed to any great degree. The implications of these conflicting statements are discussed. |
