Documentation and methodology
Underlying data are from the Organisation for Economic Co-operation and Development’s Stat Extracts public data series. Household-size-adjusted income, or equivalent income, is household income divided by the square root of the household size. Countries were chosen based on their productivity per worker hour using the “PPP Converted GDP Laspeyres Per Hour Worked by Employees at 2005 Constant Prices” series from Penn World Table Version 7.0 (Heston, Summers, and Aten 2011). We chose to exclude countries whose productivity is less than half that of the United States. The OECD data base uses slightly different methods than that found in 7I (e.g., its handling of taxes and transfers are different), therefore, the relative rates for the United States are not exactly the same.