Tuesday, June 21, 2016

Alex Tabarrok — The Middle Class is Shrinking Because Many People are Getting Richer


See, inequality is all in the mind. Everyone is doing very well and things continue to improve by historical standards. Yes, the very richer are getting much richer, but a rising tide lifts all boats.

What's wrong with this picture?

Marginal Revolution
The Middle Class is Shrinking Because Many People are Getting Richer
Alex Tabarrok | Bartley J. Madden Chair in Economics at the Mercatus Center and am a professor of economics at George Mason University

Here's the study:

Urban Institute
The Growing Size and Incomes of the Upper Middle Class
Stephen J. Rose
June 2016

6 comments:

Bob said...

Any discussion of inequality that is limited to the 1 percent misses alot of the picture because it ignores the large inequality between the growing upper middle class and the middle and lower middle classes. This difference has a physical dimension in that most metropolitan areas differ greatly by the size and price of thehomes in their neighborhoods and communities. We try to limit segregation by race or ethnicity, but segregation by income (which is growing) is accepted as a fact of life.

Sounds reasonable.

Andrew said...

Well, what IS wrong with the picture?

Bob said...

I guess Tom wanted to get a few jabs in before the actual critiques are in.

Tom Hickey said...

My question is half facetious and half sincere. Capitalism does result in all boats rising globally, not only in this picture.

One side says that this is the full picture and all one needs to know. Nothing to see here. It's all a delusion based on envy of the top.

The other side says, not so fast. What about fairness of distribution and the political consequences of power and influence.

Bob said...

Why attribute to capitalism what are in fact advances in technology and productivity?

Tom Hickey said...

Why attribute to capitalism what are in fact advances in technology and productivity?

Because in the conventional view, technology and therefore productivity are the result of capital formation and deployment. This is the sine qua non and therefore must be privileged over labor (people) and land (the environment).

Once one buys into rising tides and TINA, it's all over. Capital rules.

Welcome your capitalist masters and their minion and cronies and and thank them for the technology that makes all this abundance possible.