I have found information suggesting that wealth inequality declined in the early 20th century.
I have found a 1977 article which can be found here on Jstor that states this may well be misleading. "From the disparate data, the unwary may conclude that wealth is much more equally distributed in this century than in the 19th."
Take a look at this image. The idea appears to be that the apparent decline in relative wealth of the richest 1 percent in the 20th century is misleading somehow.
What precisely happened to the wealth disparity in the early 20th century? Why did it go down, at least on paper?
There is more recent work on this than you're citing -- see in particular Thomas Piketty's recent book "Capital in the 21st Century" [2013]. It isn't without its flaws and controversies, but Piketty does a good job pulling together a lot of data and making it usable.
The explanation for the decline in inequality in the first half of the 20th century is: two world wars and the Great Depression, which destroyed substantial amounts of physical and financial capital. People who had more capital, lost more . . . those who had little or none, lost less. Hence inequality declined. Many scholars have made similar observations, that war and other disasters like plague are the most consistent historical forces that reduce inequality.
For an examination of these data on the long time scale, see Walter Scheidel's recent work:
"The Great Leveler: Violence and the History of Inequality from the Stone Age to the Twenty-First Century" Princeton University Press:2018
