The Evolution of Household Income Volatility
(Figure Data)

Figure 1: Volatility of Household Head Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Left Panel Standard Deviation of Percent Changes Yr-by-Yr Instead of 3-Year Rolling Window Source: Authors' calculations based on PSID

	Standard Deviation
1973	22.6
1974	22.9
1975	22.8
1976	23.3
1977	24.7
1978	25.5
1979	24.5
1980	24.8
1981	23.9
1982	24.2
1983	24.4
1984	25.5
1985	26.3
1986	25.6
1987	25.9
1988	26.9
1989	25.3
1990	25.6
1991	26.1
1992	27.8
1993	28.3
1994	29.9
1995	30.4
1996	27.8
1997	ND
1998	29.1
1999	ND
2000	29
2001	ND
2002	29.3
2003	ND
2004	30.8

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Figure 1: Volatility of Household Head Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Right Panel Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Weighted Full Sample	Winsorized
1973	22.4	22.9	8.4
1974	22.7	23	8.7
1975	23	23.5	9.3
1976	23.1	23.6	8.8
1977	23.8	24.3	9
1978	24.6	25.4	8.7
1979	24.9	25.7	8.9
1980	25	25.8	9.1
1981	24.5	24.9	8.9
1982	24.3	24.6	8.7
1983	24.2	24.7	8.8
1984	24.9	25.7	9.4
1985	25.5	26.5	9.5
1986	25.8	26.9	9.6
1987	25.9	26.9	9.5
1988	26.1	27.1	9.5
1989	26	27.1	9.6
1990	26	27.1	9.5
1991	25.7	27	9.3
1992	26.5	27.8	9.5
1993	27.4	28.6	9.8
1994	28.7	29.4	10.3
1995	29.6	30.2	10.7
1996	29.4	30.2	10.8
1997	29.2	ND	10.7
1998	28.5	ND	11
1999	29.1	ND	11.3
2000	29.1	ND	11
2001	29	ND	10.6
2002	29.2	ND	10.8
2003	29.3	ND	10.6
2004	30.1	ND	11.3

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Figure 1: Volatility of Household Head Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Left Panel Transitions to Zero Percent Source: Authors' calculations based on PSID

	From $0	From $1 to $10,000	From > $10,000
1973	4.2	0.5	0.2
1974	4.1	0.4	0.2
1975	4.1	0.3	0.4
1976	4.1	0.3	0.4
1977	5.1	0.4	0.6
1978	6	0.5	0.5
1979	7	0.6	0.5
1980	6.8	0.5	0.4
1981	6.8	0.4	0.5
1982	6.5	0.5	0.7
1983	6.8	0.6	0.7
1984	6.7	0.7	0.6
1985	6.7	0.7	0.4
1986	6.3	0.6	0.4
1987	5.9	0.5	0.5
1988	5.4	0.5	0.6
1989	5.1	0.5	0.5
1990	4.8	0.4	0.6
1991	4.6	0.4	0.6
1992	4.4	0.5	0.9
1993	4.2	0.7	1.2
1994	4.2	0.8	1.3
1995	4.3	0.8	1.4
1996	4.4	0.8	1.1
1997	4.4	0.8	1.1
1998	4.5	0.6	0.8
1999	4.6	0.4	0.8
2000	4.4	0.3	0.7
2001	4.3	0.3	0.7
2002	4.2	0.5	1.2
2003	4.1	0.7	1.6
2004	4.3	0.7	1.2

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Figure 1: Volatility of Household Head Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Right Panel Transitions From Zero Percent Source: Authors' calculations based on PSID

	To $0	To $1 to $10,000	To > $10,000
1973	4.1	0.5	0.5
1974	4.1	0.4	0.5
1975	5.2	0.5	0.6
1976	6	0.6	0.8
1977	7	0.7	1
1978	6.8	0.7	0.9
1979	6.8	0.7	0.7
1980	6.5	0.6	0.5
1981	6.8	0.7	0.5
1982	6.7	0.7	0.6
1983	6.7	0.8	0.8
1984	6.3	0.8	0.9
1985	5.9	0.7	0.9
1986	5.4	0.8	0.8
1987	5.1	0.8	0.9
1988	4.8	0.8	0.9
1989	4.6	0.7	0.8
1990	4.4	0.7	0.8
1991	4.2	0.8	0.8
1992	4.2	0.8	1.1
1993	4.3	0.8	1.6
1994	4.4	0.7	1.9
1995	4.4	0.7	2.1
1996	4.5	0.9	2
1997	4.6	1.1	2.2
1998	4.5	0.9	1.9
1999	4.2	0.7	1.6
2000	4.2	0.7	1.3
2001	4.1	0.8	1
2002	4.3	0.7	1.9
2003	4.5	0.7	2.7
2004	4.5	0.7	2.7

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Figure 1: Volatility of Household Head Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Left Panel Dropping Observations with Low Values Standard Deviations of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	22.396	20.278
1974	22.699	20.651
1975	23.035	21.097
1976	23.098	21.269
1977	23.842	21.569
1978	24.606	21.869
1979	24.926	21.928
1980	25.049	22.468
1981	24.487	22.247
1982	24.277	22.227
1983	24.177	22.03
1984	24.885	22.722
1985	25.5	23.237
1986	25.803	23.703
1987	25.926	23.502
1988	26.137	23.573
1989	26.048	23.193
1990	25.964	23.231
1991	25.652	22.961
1992	26.499	24.012
1993	27.392	24.608
1994	28.712	25.6
1995	29.608	25.891
1996	29.401	25.891
1997	29.15	25.667
1998	28.542	25.021
1999	29.1	24.943
2000	29.058	25.267
2001	28.969	25.532
2002	29.243	25.634
2003	29.32	25.606
2004	30.109	26.367

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Figure 1: Volatility of Household Head Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Right Panel Probability of Large Declines and Increases Source: Authors' calculations based on PSID

	Growth < 25%	Growth > 25%
1973	0.054	0.096
1974	0.053	0.101
1975	0.068	0.088
1976	0.076	0.08
1977	0.074	0.089
1978	0.063	0.107
1979	0.06	0.114
1980	0.069	0.104
1981	0.08	0.092
1982	0.093	0.078
1983	0.093	0.081
1984	0.084	0.097
1985	0.069	0.118
1986	0.066	0.126
1987	0.067	0.123
1988	0.071	0.121
1989	0.069	0.121
1990	0.072	0.115
1991	0.08	0.108
1992	0.09	0.107
1993	0.092	0.112
1994	0.092	0.122
1995	0.087	0.132
1996	0.084	0.138
1997	0.08	0.139
1998	0.07	0.151
1999	0.064	0.167
2000	0.07	0.153
2001	0.076	0.14
2002	0.094	0.124
2003	0.112	0.109
2004	0.103	0.13

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Left Panel Heads Less than 35 Years Old Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	24.3	22.2
1974	25.5	23.5
1975	26.7	24.5
1976	27.1	25.1
1977	27.4	25.1
1978	27.1	24.5
1979	27.2	24.2
1980	27.5	24.4
1981	27.5	24.9
1982	27.6	25.3
1983	27.6	25.1
1984	28.3	25.6
1985	28.2	25.6
1986	28.5	26.1
1987	28.7	25.6
1988	29.2	25.8
1989	29.3	24.9
1990	28.9	25
1991	28.6	24.8
1992	29.4	26.3
1993	30.4	26.9
1994	31.7	28.1
1995	32.4	28.6
1996	32.3	28.9
1997	31.8	28.5
1998	31.7	28.3
1999	32.8	28.7
2000	32.4	28.1
2001	32	27.4
2002	32.8	28.5
2003	33.3	29.4
2004	32.7	29.4

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Center Panel Heads 35 to 54 Years Old Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	20.6	19.2
1974	21.3	19.5
1975	21	19.2
1976	20.8	18.8
1977	21.4	18.8
1978	23.4	19.9
1979	23.6	20.2
1980	23.6	20.8
1981	22.5	20.1
1982	22.3	19.8
1983	22.6	19.9
1984	23.4	20.7
1985	24.1	21.6
1986	24.1	21.9
1987	24.2	21.8
1988	24.2	21.7
1989	24.2	21.9
1990	24.2	22
1991	24.4	21.8
1992	25	22.4
1993	25.8	22.9
1994	26.9	23.8
1995	28.3	24.3
1996	28.1	24.3
1997	28	24.3
1998	27.2	23.5
1999	27.8	23.3
2000	28.1	23.8
2001	28.4	24.4
2002	28.4	24.2
2003	28.2	24
2004	29	24.6

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Right Panel Heads 55 Years Old and Older Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	23.6	20
1974	21.6	18.4
1975	21.7	19.4
1976	20.8	19.1
1977	22.2	20.2
1978	21.8	19.7
1979	22.5	19.8
1980	22.3	20.7
1981	22.1	20
1982	21.3	20.1
1983	20.5	19.4
1984	21.1	20.5
1985	22.7	21.2
1986	23.8	22.5
1987	24.1	23.3
1988	24.8	24.1
1989	24.6	23.6
1990	25.1	23.4
1991	23.6	22.9
1992	25.8	25.1
1993	27	26.4
1994	29	27.6
1995	29	27
1996	29.3	26.6
1997	29.4	26.3
1998	28.9	25.7
1999	28.5	25.5
2000	27.1	26.3
2001	25.8	26.9
2002	26.5	25.9
2003	26.9	24.9
2004	29.7	27.2

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Left Panel Heads with No High School Degree Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	24.6	22.4
1974	23.6	22.1
1975	23.1	22
1976	23	21.1
1977	25.5	21.8
1978	27.2	22.4
1979	28.4	23.4
1980	28	24.1
1981	27.3	24.2
1982	26.6	23.8
1983	26.7	23.8
1984	27.8	24.9
1985	28.4	25.3
1986	29.4	27.6
1987	29.6	27.9
1988	29	28.2
1989	28	26.6
1990	28.1	26.7
1991	28.3	26.7
1992	29.3	27.2
1993	31.3	27.2
1994	33.8	29.1
1995	35.9	31.4
1996	35	31.7
1997	34.9	31.8
1998	33.6	30.1
1999	33.9	30.2
2000	32.7	29.3
2001	31.1	28.2
2002	34.5	30.4
2003	37.2	32.3
2004	34.9	30.3

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Center Panel Heads with High School but No College Degree Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	21.3	18.9
1974	21.4	19
1975	21.9	19.7
1976	21.5	19.9
1977	22.7	20.9
1978	23.5	21.5
1979	23.9	21.6
1980	24.5	22.4
1981	24.5	22.3
1982	24.3	22.2
1983	23.8	21.9
1984	23.9	22.1
1985	24.7	22.7
1986	25.2	22.9
1987	25.8	23
1988	26.5	23.4
1989	26.4	23.2
1990	26.1	23
1991	25.6	22.5
1992	26.5	23.4
1993	27.6	24.4
1994	28.7	25.5
1995	29.6	25.6
1996	29.3	25.6
1997	29.2	25.4
1998	28.9	25.2
1999	29.8	25.2
2000	30	25.7
2001	30.1	26.1
2002	29.5	25.5
2003	28.6	24.7
2004	29.4	25.5

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Right Panel Heads with College Degree Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	20.8	20.2
1974	24.4	22.3
1975	25.2	22.9
1976	25.9	23.6
1977	23.9	22.4
1978	23.7	22.2
1979	23.1	21.3
1980	22.9	21.2
1981	21.4	20.4
1982	21.7	20.8
1983	22.4	20.8
1984	24.4	22.4
1985	24.9	23.1
1986	24.6	23.1
1987	24.1	22.3
1988	24.1	22.1
1989	24.5	22
1990	24.8	22.3
1991	24.7	22.5
1992	25.3	23.9
1993	25.4	24.1
1994	26.5	24.7
1995	26.9	24.5
1996	27.3	24.6
1997	26.9	24.4
1998	26.6	23.6
1999	26.6	23.4
2000	26.4	23.6
2001	26.3	23.8
2002	27.2	24.7
2003	27.9	25.4
2004	29.6	26.7

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Left Panel Male Heads Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	19.2	18.5
1974	20.4	19.5
1975	21.3	20.1
1976	21.8	20.5
1977	22.3	20.6
1978	22.8	20.8
1979	23	20.7
1980	23.4	21.4
1981	23.1	21.3
1982	23.1	21.3
1983	23	21.1
1984	23.8	22.1
1985	24	22.5
1986	24.5	23
1987	24.7	22.8
1988	25.4	23.2
1989	25.6	22.8
1990	25.5	22.8
1991	25	22.3
1992	25.5	23.3
1993	26.2	23.9
1994	27.7	24.8
1995	28.5	24.8
1996	28.3	24.8
1997	28	24.5
1998	27.4	24.1
1999	27.9	24
2000	27.9	24.4
2001	27.9	24.7
2002	28.5	25.1
2003	28.9	25.4
2004	30.1	26.2

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Figure 2: Volatility of Head Earnings by Demographic Characteristic (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Center Panel Female Heads Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0
1973	32.7	28.6
1974	30.8	26.4
1975	29.6	26.3
1976	28.2	25.5
1977	29.9	27
1978	31.5	28.2
1979	31.9	28.5
1980	31.1	28.5
1981	29.4	27.7
1982	28.5	27.1
1983	28.4	26.5
1984	28.9	25.8
1985	30.9	27.4
1986	30.8	27.5
1987	30.6	27.2
1988	29	25.7
1989	28	25.2
1990	27.9	25.7
1991	28.4	26.4
1992	30.4	27.7
1993	32.2	28.7
1994	33.1	29.7
1995	33.8	30.8
1996	33.4	30.6
1997	33.4	30.4
1998	32.9	29.1
1999	33.5	29.2
2000	33.3	29.2
2001	33.1	29.3
2002	32.3	28.3
2003	31.1	26.8
2004	30.2	27

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Figure 3: Volatility of Labor Earnings for Other Groups (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Left Panel Spouses Standard Deviation of Percent Changes Year-by-Year Instead of 3-Year Rolling Windows Source: Authors' calculations based on PSID

	Standard Deviation
1973	39
1974	42
1975	41.8
1976	42.5
1977	42
1978	42.5
1979	42.7
1980	42.6
1981	41.1
1982	40.9
1983	40
1984	41.5
1985	40.6
1986	40.4
1987	38
1988	38.3
1989	38.9
1990	36.8
1991	37
1992	37.2
1993	39.6
1994	37.3
1995	37.9
1996	36.5
1997	ND
1998	34.9
1999	ND
2000	35.8
2001	ND
2002	35.6
2003	ND
2004	34.4

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Figure 3: Volatility of Labor Earnings for Other Groups (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Right Panel Spouses Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Standard Deviation
1973	39
1974	39.9
1975	41
1976	42.1
1977	42.1
1978	42.3
1979	42.4
1980	42.7
1981	42.2
1982	41.6
1983	40.7
1984	40.9
1985	40.7
1986	40.9
1987	39.7
1988	38.9
1989	38.4
1990	38
1991	37.6
1992	37
1993	38
1994	38.1
1995	38.3
1996	37.2
1997	37.2
1998	35.7
1999	34.9
2000	35.4
2001	35.8
2002	35.7
2003	35.6
2004	35

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Figure 3: Volatility of Labor Earnings for Other Groups (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Left Panel Spouses Transitions to $0 Percent Source: Authors' calculations based on PSID

	From $0	From $1 to $10,000	From > $10,000
1973	38.8	3.8	1.8
1974	38.1	3.7	1.8
1975	35.7	3.3	1.7
1976	33.9	3.3	1.8
1977	31.5	3.5	2
1978	29.8	3.5	2.1
1979	27.8	3.1	1.9
1980	26.3	2.9	1.6
1981	24.9	2.8	1.5
1982	24.1	3	1.9
1983	23.2	3.2	1.8
1984	21.8	3.1	1.6
1985	20.4	2.8	1.2
1986	18.5	2.9	1.1
1987	17.7	3.1	1.1
1988	16.6	3.3	1.1
1989	16	2.6	1.1
1990	15	2.1	1
1991	14.4	2.1	1.1
1992	14.1	2.5	1.3
1993	14	2.8	1.5
1994	14.2	2.7	1.7
1995	14.6	2.6	1.6
1996	14.7	2.4	1.6
1997	14.8	2.4	1.4
1998	14	2.4	1.6
1999	13.4	2.5	1.8
2000	13	2.4	1.9
2001	12.6	2.4	2
2002	12.7	2.1	2.2
2003	12.8	1.9	2.3
2004	13.6	1.9	1.8

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Figure 3: Volatility of Labor Earnings for Other Groups (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Right Panel Spouses Transitions from $0 Percent Source: Authors' calculations based on PSID

	To $0	To $1 to $10,000	To > $10,000
1973	35.8	7.4	3.3
1974	33.9	8.5	3.5
1975	31.5	8.3	3.3
1976	29.9	8.6	2.9
1977	27.9	8.9	3
1978	26.4	8.4	3.2
1979	25	7.8	2.9
1980	24.1	6.9	2.4
1981	23.2	6.6	2.2
1982	21.8	6.8	2.5
1983	20.3	6.4	2.8
1984	18.5	6.2	2.6
1985	17.7	5.5	2.1
1986	16.6	5.6	1.7
1987	16	6.2	1.8
1988	15	6.1	1.9
1989	14.4	5.5	1.9
1990	14.1	4.3	1.9
1991	14.1	3.6	2.2
1992	14.2	3.5	2.2
1993	14.6	3.9	2.4
1994	14.8	4	2.6
1995	14.9	4.1	2.9
1996	14	3.6	2.8
1997	13.3	3.6	2.4
1998	13	3.5	2.1
1999	12.4	3.3	1.7
2000	12.7	3.3	2
2001	12.7	3.3	2.2
2002	13.7	3.5	2.1
2003	14.4	3.6	2
2004	14.2	3.6	2

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Figure 3: Volatility of Labor Earnings for Other Groups (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Left Panel All Heads and Spouses Standard Deviations of Percent Changes Dropping all $0s for Heads, Successive $0s for Spouses Source: Authors' calculations based on PSID

	Standard Deviation
1973	29.1
1974	29.9
1975	30.5
1976	30.5
1977	30.4
1978	30.4
1979	30.7
1980	31
1981	30.8
1982	30.6
1983	30.1
1984	30.4
1985	30.6
1986	30.9
1987	30.4
1988	29.8
1989	29.2
1990	28.9
1991	28.5
1992	29.1
1993	30.3
1994	31.2
1995	31.4
1996	30.7
1997	30.6
1998	29.3
1999	28.8
2000	29.3
2001	29.6
2002	29.4
2003	29.1
2004	29.3

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Figure 3: Volatility of Labor Earnings for Other Groups (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Right Panel Heads Standard Deviations of Percent Changes Dropping Selected Observations Source: Authors' calculations based on PSID

	Dropping Values = $0	Also Dropping when HHs Have Interest in a Business
1973	20.3	19.5
1974	20.7	20
1975	21.1	20.1
1976	21.3	20.3
1977	21.6	20.6
1978	21.9	21.1
1979	21.9	21.4
1980	22.5	21.9
1981	22.2	21.6
1982	22.2	21.7
1983	22	21.7
1984	22.7	22.2
1985	23.2	22.3
1986	23.7	22.5
1987	23.5	22.3
1988	23.6	22.5
1989	23.2	21.9
1990	23.2	21.8
1991	23	21.2
1992	24	22.2
1993	24.6	22.5
1994	25.6	23.8
1995	25.9	23.7
1996	25.9	23.6
1997	25.7	23
1998	25	22.9
1999	24.9	23.3
2000	25.3	23.1
2001	25.5	22.9
2002	25.6	23.3
2003	25.6	23.5
2004	26.4	23.9

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Figure 4: Volatility of Head and Spouse Combined Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Left Panel Standard Deviation of Percent Changes Year-by-Year Instead of 3-Year Rolling Windows Source: Authors' calculations based on PSID

	Standard Deviation
1973	21.6
1974	21.4
1975	21.3
1976	21.4
1977	23.7
1978	24.2
1979	23.2
1980	23.4
1981	22.9
1982	22.3
1983	23.3
1984	23.9
1985	25.3
1986	24.2
1987	24.1
1988	24.5
1989	23.6
1990	24.3
1991	23.9
1992	26
1993	26.3
1994	27.4
1995	28.7
1996	26
1997	ND
1998	26.9
1999	ND
2000	28.4
2001	ND
2002	27
2003	ND
2004	27.6

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Figure 4: Volatility of Head and Spouse Combined Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Upper Right Panel Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0 for Head Labor
1973	21.7	19.7
1974	21.5	19.7
1975	21.7	20
1976	21.4	19.8
1977	22.3	20.2
1978	23.2	20.7
1979	23.7	21
1980	23.7	21.4
1981	23.2	21.4
1982	22.9	21.1
1983	22.9	21
1984	23.4	21.3
1985	24.3	22
1986	24.5	22.4
1987	24.6	22.2
1988	24.3	22.1
1989	24.1	21.8
1990	24.2	22
1991	24	21.7
1992	24.7	22.4
1993	25.4	22.9
1994	26.6	23.8
1995	27.6	24.4
1996	27.4	24.3
1997	27.4	24.2
1998	26.5	23.5
1999	26.9	23.7
2000	27.7	24.4
2001	28.4	25.1
2002	27.8	24.5
2003	27	23.8
2004	27.3	24.2

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Figure 4: Volatility of Head and Spouse Combined Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Left Panel Head Labor Earnings Down Income within |5%| Called Unchanged Source: Authors' calculations based on PSID

	Spouse Labor Earnings Up	Spouse Labor Earnings Down	Spouse Labor Earnings Unchanged
1973	30.9	18	51.1
1974	32.5	19.4	48.1
1975	33.6	20.4	46
1976	35.2	19.7	45.1
1977	36.1	19.9	44
1978	37.6	20	42.3
1979	36.8	20.3	42.9
1980	35.5	23.6	40.8
1981	33.7	25	41.3
1982	34.1	26.1	39.8
1983	36.1	24.1	39.8
1984	41.3	20.8	37.9
1985	44.6	18.9	36.5
1986	45.2	19.1	35.8
1987	43.3	21.5	35.2
1988	43.2	22.4	34.4
1989	40.9	25	34.1
1990	40.1	25.1	34.8
1991	38.6	26.1	35.3
1992	40.1	25	34.9
1993	40.9	25.5	33.6
1994	39.7	25.8	34.6
1995	37.1	27.2	35.8
1996	35.8	26.6	37.6
1997	37.2	26.2	36.6
1998	39.7	24	36.3
1999	39.7	23.7	36.6
2000	38.8	25.7	35.5
2001	38	27.3	34.6
2002	37.4	26.7	36
2003	36.8	26.1	37
2004	34.4	25.4	40.1

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Figure 4: Volatility of Head and Spouse Combined Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Middle Right Panel Head Labor Earnings Up Income within |5%| Called Unchanged Source: Authors' calculations based on PSID

	Spouse Labor Earnings Up	Spouse Labor Earnings Down	Spouse Labor Earnings Unchanged
1973	32.7	19.5	47.9
1974	32.8	19.2	48
1975	31.9	20.9	47.2
1976	33.1	22.6	44.3
1977	34.2	23.4	42.4
1978	36.6	23	40.4
1979	37	24.3	38.8
1980	37.1	25.7	37.2
1981	35.7	27.9	36.4
1982	35.7	28.4	35.9
1983	37.6	26.6	35.8
1984	40.3	23.6	36.1
1985	42.3	21.8	35.8
1986	44.5	21.2	34.3
1987	45.5	20.9	33.7
1988	45.1	22.6	32.3
1989	44	23.3	32.7
1990	42.7	25.4	31.9
1991	42.6	25.2	32.2
1992	42.3	25.8	31.9
1993	43.4	24.6	32
1994	40.6	25.5	33.8
1995	39.5	25.7	34.8
1996	36.2	26.1	37.7
1997	36.8	25.1	38.1
1998	39.8	23.5	36.7
1999	44	22.8	33.2
2000	43.7	22.2	34.1
2001	43.4	21.5	35.1
2002	42.2	22.4	35.3
2003	40.9	23.5	35.7
2004	38.3	23.4	38.3

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Figure 4: Volatility of Head and Spouse Combined Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Left Panel Head Labor Earnings Down Income within |5%| Called Unchanged Amount Replaced by Spouse Labor Earnings Source: Authors' calculations based on PSID

	Head Labor Earnings Down
1973	0.013
1974	0.01
1975	0.027
1976	0.041
1977	0.083
1978	0.093
1979	0.102
1980	0.028
1981	0.001
1982	-0.023
1983	0.013
1984	0.1
1985	0.158
1986	0.186
1987	0.187
1988	0.177
1989	0.092
1990	0.026
1991	0.003
1992	0.06
1993	0.113
1994	0.067
1995	-0.039
1996	-0.062
1997	-0.037
1998	0.101
1999	0.098
2000	0.051
2001	0.015
2002	-0.051
2003	-0.104
2004	-0.104

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Figure 4: Volatility of Head and Spouse Combined Labor Earnings (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample Excluding Those with Farm Income). Lower Right Panel Head Labor Earnings Up Income within |5%| Called Unchanged Amount Replaced by Spouse Labor Earnings Source: Authors' calculations based on PSID

	Head Labor Earnings Up
1973	-0.008
1974	-0.048
1975	-0.047
1976	-0.019
1977	-0.003
1978	-0.006
1979	-0.033
1980	-0.051
1981	-0.03
1982	0.033
1983	-0.006
1984	-0.072
1985	-0.145
1986	-0.143
1987	-0.155
1988	-0.129
1989	-0.14
1990	-0.097
1991	-0.1
1992	-0.065
1993	-0.143
1994	-0.128
1995	-0.092
1996	-0.042
1997	-0.025
1998	-0.159
1999	-0.218
2000	-0.19
2001	-0.159
2002	-0.136
2003	-0.109
2004	-0.035

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Figure 5: Volatility of Head and Spouse Capital and Transfer Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Upper Left Panel Head and Spouse Capital Income Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Standard Deviation
1973	44
1974	43.8
1975	43.9
1976	44.3
1977	44
1978	45.2
1979	45.4
1980	46.4
1981	45.9
1982	45.5
1983	45.1
1984	44.8
1985	45.3
1986	45.6
1987	45.6
1988	45.3
1989	44.9
1990	44.4
1991	43.5
1992	43.6
1993	44.8
1994	46.3
1995	46.5
1996	46
1997	45.5
1998	44.4
1999	44
2000	45.5
2001	46.7
2002	45.5
2003	43.8
2004	45.6

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Figure 5: Volatility of Head and Spouse Capital and Transfer Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Upper Right Panel Head and Spouse Transfer Income Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Standard Deviation
1973	37.1
1974	34.9
1975	36.8
1976	38.5
1977	39.5
1978	39.4
1979	39.2
1980	39.6
1981	40.1
1982	40.9
1983	41.1
1984	41
1985	39.9
1986	38.3
1987	37.8
1988	37.7
1989	38.3
1990	38.3
1991	39.2
1992	40.2
1993	42.3
1994	43.7
1995	44.2
1996	43.5
1997	42.8
1998	42.9
1999	43.1
2000	42.5
2001	41.7
2002	43.3
2003	44.7
2004	44.4

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Figure 5: Volatility of Head and Spouse Capital and Transfer Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Middle Left Panel Market Income Down Income within |5%| Called Unchanged Source: Authors' calculations based on PSID

	Head / Spouse Transfer Income Up	Head / Spouse Transfer Income Down	Head / Spouse Transfer Income Unchanged
1973	19.5	5.6	74.9
1974	20.6	4.5	74.9
1975	22.4	4.7	72.9
1976	25.7	4.6	69.6
1977	26.9	5	68.2
1978	28.4	6	65.6
1979	25.1	6.8	68.1
1980	26.7	7.8	65.5
1981	27.2	7.5	65.3
1982	31.5	7.5	61
1983	34.5	6.7	58.7
1984	36.1	6.8	57.1
1985	33.6	7.3	59.1
1986	30.2	8.2	61.6
1987	27.8	8.4	63.8
1988	27.4	7.6	65
1989	25.9	7.3	66.8
1990	27	7.2	65.8
1991	27.3	7.7	65
1992	29	7.5	63.5
1993	28.8	8.1	63.2
1994	28	8.4	63.6
1995	25.4	9.1	65.5
1996	25.5	8.7	65.7
1997	25	8.8	66.3
1998	29	7.2	63.8
1999	33	6.3	60.7
2000	29.6	10	60.4
2001	26.8	13.1	60.1
2002	27.2	10.6	62.2
2003	27.4	8.8	63.8
2004	28	9.9	62.1

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Figure 5: Volatility of Head and Spouse Capital and Transfer Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Middle Right Panel Market Income Up Income within |5%| Called Unchanged Source: Authors' calculations based on PSID

	Head / Spouse Transfer Income Up	Head / Spouse Transfer Income Down	Head / Spouse Transfer Income Unchanged
1973	9.1	8.3	82.6
1974	9.6	6.8	83.6
1975	10.8	6.6	82.6
1976	12.3	7	80.7
1977	13.7	7.7	78.6
1978	12.9	10.1	77
1979	13.5	12	74.5
1980	13.2	14.2	72.6
1981	14.1	14.7	71.3
1982	13.7	13.1	73.2
1983	13.4	12.4	74.2
1984	14	12.2	73.7
1985	14	13.5	72.5
1986	13.2	13.6	73.2
1987	12.6	12.5	74.9
1988	12.1	11.2	76.7
1989	12.6	9.9	77.5
1990	12.4	9.9	77.7
1991	14.7	10.4	74.9
1992	15.5	10.3	74.2
1993	16.5	10.8	72.7
1994	15.4	11.1	73.6
1995	16	12.3	71.7
1996	16.7	11.9	71.4
1997	17.1	11.5	71.3
1998	19.5	9.3	71.3
1999	20.7	8	71.3
2000	19.2	8.6	72.3
2001	17.5	9.2	73.3
2002	17.4	11	71.6
2003	17.2	13.3	69.4
2004	17.2	12.3	70.5

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Figure 5: Volatility of Head and Spouse Capital and Transfer Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Lower Left Panel Market Income Down Income within |5%| Called Unchanged Amount Replaced by Transfer Income Source: Authors' calculations based on PSID

	Market Income Down
1973	0.039
1974	0.041
1975	0.053
1976	0.061
1977	0.058
1978	0.058
1979	0.044
1980	0.042
1981	0.036
1982	0.052
1983	0.076
1984	0.091
1985	0.077
1986	0.066
1987	0.066
1988	0.067
1989	0.046
1990	0.036
1991	0.045
1992	0.06
1993	0.057
1994	0.033
1995	0.013
1996	0.035
1997	0.047
1998	0.113
1999	0.162
2000	0.093
2001	0.037
2002	0.022
2003	0.01
2004	0.013

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Figure 5: Volatility of Head and Spouse Capital and Transfer Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Lower Right Panel Market Income Up Income within |5%| Called Unchanged Amount Replaced by Transfer Income Source: Authors' calculations based on PSID

	Market Income Up
1973	0.029
1974	0.031
1975	0.028
1976	0.024
1977	0.025
1978	0.042
1979	0.044
1980	0.058
1981	0.044
1982	0.052
1983	0.038
1984	0.045
1985	0.041
1986	0.043
1987	0.036
1988	0.03
1989	0.026
1990	0.028
1991	0.02
1992	0.017
1993	0.028
1994	0.053
1995	0.04
1996	0.037
1997	0.02
1998	0.044
1999	0.038
2000	0.018
2001	-0.002
2002	0.027
2003	0.064
2004	0.057

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Figure 6: Volatility of Total Household Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Upper Left Panel Standard Deviation of Percent Changes Year-by-Year Instead of 3-Year Rolling Windows Source: Authors' calculations based on PSID

	Standard Deviation
1973	19.6
1974	19.3
1975	19.6
1976	20
1977	20.7
1978	20.7
1979	21.3
1980	21.1
1981	19.9
1982	19.5
1983	20.4
1984	20.7
1985	21.6
1986	22.1
1987	21.5
1988	22.4
1989	22.2
1990	22.3
1991	21.4
1992	23.7
1993	24.3
1994	25.5
1995	26.4
1996	24.2
1997	ND
1998	25.6
1999	ND
2000	27.6
2001	ND
2002	24.6
2003	ND
2004	25.6

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Figure 6: Volatility of Total Household Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Upper Right Panel Standard Deviation of Percent Changes Source: Authors' calculations based on PSID

	Baseline	Dropping Values = $0 for Head Labor
1973	19.1	18.2
1974	19.4	18.6
1975	19.7	18.7
1976	19.8	18.7
1977	20.3	19
1978	20.5	19.1
1979	20.9	19.3
1980	21.1	19.7
1981	20.8	19.4
1982	20.2	19
1983	20	18.8
1984	20.3	19.2
1985	20.9	19.8
1986	21.5	20.3
1987	21.8	20.4
1988	22	20.7
1989	22.1	20.6
1990	22.4	20.7
1991	22	20.2
1992	22.5	20.7
1993	23.1	21.1
1994	24.5	22
1995	25.5	22.7
1996	25.4	22.7
1997	25.3	22.7
1998	25	22.7
1999	25.6	23.3
2000	26.6	24.1
2001	27.6	24.8
2002	26.3	23.5
2003	24.6	22
2004	25.2	22.6

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Figure 6: Volatility of Total Household Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Middle Left Panel Probability of Large Declines Dropping Values = $0 for Head Labor Source: Authors' calculations based on PSID

	Growth < 25%	Growth < 50%
1973	0.071	0.006
1974	0.074	0.006
1975	0.09	0.006
1976	0.094	0.008
1977	0.085	0.008
1978	0.073	0.008
1979	0.073	0.009
1980	0.092	0.01
1981	0.107	0.011
1982	0.116	0.011
1983	0.103	0.009
1984	0.087	0.009
1985	0.079	0.01
1986	0.079	0.011
1987	0.078	0.011
1988	0.075	0.01
1989	0.074	0.009
1990	0.082	0.011
1991	0.093	0.013
1992	0.094	0.013
1993	0.092	0.013
1994	0.092	0.015
1995	0.096	0.018
1996	0.099	0.018
1997	0.098	0.017
1998	0.09	0.013
1999	0.084	0.012
2000	0.09	0.013
2001	0.095	0.014
2002	0.113	0.016
2003	0.131	0.018

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Figure 6: Volatility of Total Household Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Middle Right Panel Probability of Large Increases Dropping Values = $0 for Head Labor Source: Authors' calculations based on PSID

	Growth > 25%	Growth > 50%
1973	0.089	0.018
1974	0.09	0.021
1975	0.08	0.018
1976	0.079	0.017
1977	0.085	0.019
1978	0.1	0.022
1979	0.101	0.023
1980	0.092	0.022
1981	0.075	0.019
1982	0.062	0.017
1983	0.065	0.016
1984	0.08	0.019
1985	0.098	0.024
1986	0.111	0.026
1987	0.113	0.028
1988	0.115	0.031
1989	0.11	0.032
1990	0.101	0.031
1991	0.089	0.025
1992	0.089	0.029
1993	0.099	0.031
1994	0.108	0.033
1995	0.111	0.033
1996	0.109	0.032
1997	0.111	0.033
1998	0.122	0.037
1999	0.134	0.045
2000	0.14	0.049
2001	0.146	0.052
2002	0.114	0.039
2003	0.084	0.026
2004	0.097	0.031

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Figure 6: Volatility of Total Household Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Lower Left Panel Percentiles in Lower Half of Distribution Dropping Values = $0 for Head Labor Source: Authors' calculations based on PSID

	50th Percentile	25th Percentile	10th Percentile	5th Percentile
1973	3.4	-4.9	-15.8	-23.8
1974	2.8	-5.7	-16.3	-24.1
1975	1	-7.5	-18.6	-26.4
1976	0.4	-8.2	-19.1	-27.5
1977	1.4	-6.7	-18	-26.8
1978	3	-4.8	-16.1	-24.4
1979	2.9	-4.9	-16.2	-24.3
1980	1.3	-7.2	-19.1	-27.9
1981	-0.5	-9	-20.8	-30.3
1982	-1	-9.6	-21.6	-31.1
1983	0.3	-8.2	-20.5	-28.8
1984	2.1	-5.9	-18.1	-27
1985	3.4	-4.5	-16.1	-25.5
1986	3.8	-4.2	-16.4	-25.8
1987	3.7	-4.4	-16.2	-26.1
1988	3.4	-4.5	-15.8	-25.6
1989	2.9	-5.2	-16.1	-25.6
1990	1.9	-6.1	-17.2	-27.2
1991	1.1	-6.9	-19.1	-29.2
1992	1.2	-6.6	-19.3	-29.5
1993	1.7	-6.2	-19	-29.2
1994	2.1	-5.9	-18.8	-29.8
1995	2.2	-6.5	-19.5	-30.5
1996	2.2	-6.5	-19.9	-31.7
1997	2.4	-6.5	-19.8	-30.7
1998	3.5	-4.9	-18.8	-28.8
1999	4.7	-3.7	-17.6	-27
2000	4.2	-4.8	-18.8	-28.9
2001	3.8	-5.7	-19.5	-30.9
2002	2	-7.4	-22	-32.4
2003	0.2	-8.8	-24.8	-33.8
2004	1.1	-7.8	-22.6	-34.1

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Figure 6: Volatility of Total Household Income (3-year Rolling Window; Annualized 2-Year Change Scaled by 3-Year Average Lagged Income, Topcoded at 100 Percent; Representative Sample). Lower Right Panel Percentiles in Upper Half of Distribution Dropping Values = $0 for Head Labor Source: Authors' calculations based on PSID

	50th Percentile	75th Percentile	90th Percentile	95th Percentile
1973	3.4	12.1	23.3	33.2
1974	2.8	11.7	23.3	34.5
1975	1	10	21.8	33
1976	0.4	9.1	21.3	32.1
1977	1.4	10.3	22.5	32.6
1978	3	12	25	35.2
1979	2.9	12.3	25.2	36.1
1980	1.3	10.6	23.7	33.8
1981	-0.5	8.2	20.8	30.9
1982	-1	7	18.7	28.3
1983	0.3	8.5	19.9	28.6
1984	2.1	10.9	22.4	32.4
1985	3.4	12.4	24.9	35.7
1986	3.8	13.1	26.5	38.7
1987	3.7	13.1	26.9	38.9
1988	3.4	13	27.1	40.6
1989	2.9	12.2	26.8	39.6
1990	1.9	10.7	25.3	38.5
1991	1.1	9.7	22.9	34.3
1992	1.2	9.7	22.8	36.3
1993	1.7	11	24.8	38.3
1994	2.1	11.8	26.2	40
1995	2.2	12.1	26.5	40.2
1996	2.2	11.9	26.4	40.3
1997	2.4	12.2	26.9	41.1
1998	3.5	13.5	28.7	43.3
1999	4.7	14.2	31.3	48.3
2000	4.2	14.7	32.3	49.2
2001	3.8	15.2	33.6	51.1
2002	2	12	27.9	43.4
2003	0.2	9.7	22.6	36.1
2004	1.1	10.4	24.5	38.4

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