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buybuydandavis comments on [Retracted] Simpson's paradox strikes again: there is no great stagnation? - Less Wrong
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Thomas Sowell makes a similar point about stagnation of "household" income. The demographics of households have changed dramatically, with a large increase in households with single adults, and single non dependent adults. Two incomes make less money than one, so household incomes can look worse.
I don't think this accurately captures any real issues with young dependent adults, but that's just another instance of the problem of summary statistics of heterogeneous aggregates.
Ah, yeah, I looked up the median household income and was slightly surprised it hadn't dramatically increased as you'd naively expect if the OP's explanation is right. Thanks for explaining :)