I have access to a database with several variables containing data on compensation of employees. I am very interested in creating a variable similar to household income, where the income of the self-employed and wages payed to employees are both taken into consideration.

The data-set contains information on mixed-income, which I could include to this previous variable. However, from my understanding, mixed income includes some form of capital profits as well as this income of the self-employed.

Is there a way to separate pure income from capital profits from this mixed income variable? If not, is there any way at all to estimate household income? This data-set also includes information on value added, consumption of fixed capital and taxes - subsidies. Would subtracting consumption of fixed capital from mixed income work?

Thank you for your help!

  • 3
    $\begingroup$ There is not an easy way to split unincorporated "mixed income" into profits and effective remuneration for labour. You could attempt to do so by trying to work out how many people are involved, how much they work, and how much they might be paid if they were doing this work for somebody else. But it would just be a guess. $\endgroup$
    – Henry
    Feb 8 at 14:19
  • $\begingroup$ Thank you for your answer! That's unfortunate... I would have data also on the number of hours worked, and workers engaged, but guessing their salary would be too much of a guess $\endgroup$
    – Adrian
    Feb 9 at 13:29

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