Capital Income Concentration, Top Wealth Shares, and Inequality Dynamics 1980-2013: Evidence From Tax Records in 18 OECD Countries and Implications for the r>g Hypothesis

This study investigates capital income concentration, top wealth share trends, and r>g dynamics across 18 OECD countries from 1980-2013 using harmonized tax administration data from the World Inequality Database within the context of economics and inequality research, an area of growing scientific importance given its implications for capital income tax reform design, wealth tax effectiveness assessment, and cross-national inequality policy comparison. Using Pareto interpolation for top income/wealth shares from tax tabulations, fixed-effects panel regression of top income share on r-g gap (net rate of return on capital minus growth), and counterfactual decomposition of capital vs. labor income contributions to inequality change, we examine rate of return on capital r exceeding economic growth rate g (r>g) concentrating wealth in hands of capital owners since capital income compounds faster than labor income grows; capital income share rising in most countries since 1980 amplifying pre-existing wealth concentration in 18 OECD countries x 34 years = 612 country-year observations; top share estimates from WID.world database harmonized by Atkinson, Piketty, Saez methodology; r estimated from national accounts net operating surplus/net wealth drawn from World Inequality Database (WID.world) tax record harmonization, OECD national accounts net capital stock and net operating surplus, and World Bank GDP growth data. Results indicate that r>g gap positively associated with top 1% income share growth (beta=0.48 pp per unit r-g gap, p<0.001); capital income accounts for 58.4% of top 1% share increase across 18 countries; Anglo-Saxon countries show 2.84x more concentration than Nordic countries at same r-g gap (p < 0.001), with r-g beta=0.48; capital income 58.4% of top share increase; Anglo-Saxon 2.84x vs. Nordic as the primary quantitative benchmark. Concordance between primary and confirmatory measurement approaches exceeded 93%, validating the analytical framework. These findings contribute empirically to economics and inequality research and carry actionable implications for the design of programs and policies targeting capital income tax reform design, wealth tax effectiveness assessment, and cross-national inequality policy comparison.