Who Are The One Percent?

Economics 21 says that it changes constantly:

[M]ost of the churn in the top 1% over the course of 30 years is related to life cycle trends. Many households that were part of the top 1% in 2005, for example, have since retired and been replaced by households whose primary earners were in more junior positions in their company, attending graduate school, or yet to start their own businesses in 2005. A large number of taxpayers who benefitted from the Bush tax cuts are likely out of the labor force. Raising taxes on the top 1% is therefore not going to impact them.

Beyond life cycle, another issue that’s behind the churn in the top 1% of the income distribution comes from non-recurring sources of income, like asset sales. Every year, some portion of the top 1% sell family businesses, large stock portfolios, or real estate. The capital gains on these sales is non-recurring; the capital gains income from these sales comes in a single year. These sales may push up the average income of the top 1% for that year, but they have no impact on the average earnings of the group. 

Reihan adds two cents.