Meyer and Sullivan disaggregate by household type (married-parent, single-parent, single families without kids, married couples without kids, 65+ headed) and by race, employment, and education, then aggregate; doing so yields different answers than lumping everyone together, but they find changes in family composition do not play a big part in changes in median income or poverty over their period.

Much of the increase in inequality has been attributed to rising demand for high-skilled labor combined with the failure of the US to supply enough high-skilled labor; minimum wage changes and high early-1980s inflation are other suggested but uncertain factors.

Physical ownership data show the bottom 20% are materially much better off than in 1980: in 1980, 27% of those in the bottom income quintile had central air, versus 67% in 2009 (nearly triple), with similar gains in dishwasher, washer, and dryer ownership; structural housing problems like roof leaks and plumbing problems have nearly disappeared.

Over the last 10 years, poverty measured by consumption has fallen much faster than poverty based on income (the official income measure shows poverty rising), and longer-term indicators like housing types and cars driven suggest the bottom has seen real improvement in living standards despite the awful last three years.

For people at the bottom, income is hard to measure because it comes from many irregular sources (formal/informal work, money from family, friends, boyfriends, fathers of children, and government transfers), as documented by Edin and Lein; these same people report rent and weekly food spending fairly accurately, so consumption gives a better read of their living standard.

The after-tax 90/10 income inequality ratio in 2009 was about the same as in 1993 (dipping in the 1990s, rising in the 2001-02 recession), largely because the 10th percentile did quite well after accounting for taxes, including payroll taxes; meanwhile the 90/50 ratio rose from about 2.5 around 1990 to roughly 2.75 today—a relatively small increase compared to public perception.

The picture of well-being looks much better if you account for what people can actually spend (after-tax income); taxes matter substantially at the median, particularly in the 2000s, because of the 2001 and 2003 income tax cuts which were spread fairly evenly across the income distribution in percentage terms rather than going entirely to the rich.

An independent way to confirm CPI overstates inflation is to find the income adjustment that keeps spending patterns (shares spent on food, clothing, leisure) constant over time at a given real income level; researchers like Costa and Bruce Hamilton have done this and arrive at CPI biases not very different from the Boskin Commission's.

Healthcare is deliberately excluded from Meyer and Sullivan's research because there is less professional agreement on how to handle the tremendous quality changes; children's access (e.g., share with annual checkups) has improved, but the share of median-income people with insurance has declined over time, which would offset some gains if access to better technology fell.

Most of the measured 50% improvement at the median comes from the inflation adjustment, but a substantial part (particularly in the 2000s) comes from tax cuts; for those in the bottom 10-20%, transfers matter much more than taxes, and the combination of raising exemptions and expanding the Earned Income Tax Credit dramatically increased after-tax incomes of the poor relative to pre-tax income.

Poverty has declined much faster for households headed by someone 65 and older and for single-mother-headed households than for the overall population, while married couples with children have seen their poverty rate decline more slowly than other groups—even more so when measured by spending rather than income.

Consumption is a better measure of well-being than one year's income because families save for rainy days and can consume out of past savings; this is especially true for retired households (over 80% of those headed by someone 65+ own their home and at least one car), whose low current incomes badly understate their well-being.

Surveys like the Current Population Survey poorly capture government transfers: matching CPS data to government records shows the survey captures only about half of food stamps actually paid out, not necessarily from shame but because respondents skip the laborious reporting of benefits, so official income/inequality data understate the well-being of the poor.

There was a large increase in inequality in the late 1970s and early 1980s by every measure, but since the late 1980s—when measured with after-tax income or better yet consumption—inequality has grown only modestly for the bulk of the population, and the 10th percentile has actually risen relative to the median, especially in the last 10 years.

Debt-fueled consumption is a real concern at the median (visible in the post-crisis decline as people repay debts and worry about the economy) but is not a big driver of increased consumption at the bottom near the poverty line, where little borrowing occurs.

The popular claims that the middle class is being hollowed out, incomes are stagnating for all but the top, and the rising tide did not lift all boats are basically wrong, as shown by ten years of research with James Sullivan; properly accounting for inflation, median incomes have risen about 50% since 1980, and consumption has risen by a similar amount.

The CPI overstates inflation because it fails to adequately keep track of new goods and to adjust for quality improvements; the Boskin Commission concluded in 1996 it overstated inflation by about 1.1 percentage points per year, and members polled more recently still estimate a bias of about 0.7 to 0.9 percentage points per year.

It took the BLS about 15 years to include cell phones in the CPI basket after their introduction, and historically most goods (electric refrigerators, used cars) were included only long after the majority of people owned them; because new goods often fall dramatically in price, leaving them out misses a large component of real price decline.

Housing is about 40% of consumption across income levels, and the size of housing units has gone up dramatically while problems like roof leaks and plumbing defects have nearly disappeared, undercutting the claim that gains are merely cheap electronic 'toys' while big-ticket items got more expensive.

Globalization and technological change both reduced demand for low-skilled US workers (their products are made overseas or by machines), and because the US K-12 school system is mediocre and has not responded vigorously to prepare strugglers for college, this is part of the inequality problem—yet because most of the period shows little inequality increase, globalization and immigration are not the threats to living standards that some claim, especially since their pace intensified precisely when inequality was not rising.