People who decide to leave their country and test their luck elsewhere are usually no random sample of a population. In his 1987 paper “Self-Selection and the Earnings of Immigrants” (American Economic Review 77, pp. 531-553), Harvard Political Scientist George J. Borjas discusses the so-called self-selection of migrants. As of 1987, the standard view among migration economists was that migrants, at least those who came to the United States, belonged to the “upper tails” of the income distributions in their home countries.

In November 2015, the National Audit Office of the UK has published a report saying: “The Department for Work and Pensions has successfully introduced automatic enrolment to workplace pensions for large and medium-sized employers.” The National Audit Office found that 58,000 employers have enrolled 5.4 million workers between October 2012 and August 2015. The huge increase in enrolment was due to a small policy change introduced by the UK government in October 2012.

As argued by Omer Moav and Zvika Neeman in a 2012 paper (Moav taught at ISET in the past), boasting is a way to pretend that one has hidden income (“Saving Rates and Poverty: The Role of Conspicuous Consumption and Human Capital”, Economic Journal 122, pp. 933-956). While people may have a rough idea of the incomes of their neighbors, colleagues, friends, and other people they interact with, they usually do not know exactly how much they make.