The Rise of the Super-Rich

Abstract

The income share of the super-rich in the United States has grown rapidly since the early 1980s after a period of postwar stability. What factors drove this change? In this study, we investigate the institutional, policy, and economic shifts that may explain rising income concentration. We use single-equation error correction models to estimate the long-and shortrun effects of politics, policy, and economic factors on pretax top income shares between 1949 and 2008. We find that the rise of the super-rich is the result of rightward-shifts in Congress, the decline of labor unions, lower tax rates on high incomes, increased trade openness, and asset bubbles in stock and real estate markets.

Financialization Is Marketization! A Study of the Respective Impacts of Various Dimensions of Financialization on the Increase in Global Inequality

“…As in previous works (Alderson and Nielsen 2002;Kristal 2010;Volscho and Kelly 2012), I find that unionization reduces inequality, especially for the top 10 percent share and for the D9/D5 ratio. Rate of imports, which seeks to approach the effects of globalization (Sassen 2001) and external competition, increases inequality at the bottom of the distribution.…”

“…As explanatory variables, I use indicators of various forms of financialization and some control variables that are available for all countries during a large time period-GDP per capita, unionization rate, importation rate-variables for which literature on inequality underlines their possible impact (Kristal 2010;Volscho and Kelly 2012;Kus 2013;Dünhaupt 2014). I also checked that the inclusion of additional I use two types of regression models in order to evaluate the link between financialization and inequality measures.…”

Income Inequality and the Persistence of Racial Economic Disparities

“…Alternative explanations for the increase in income inequality have emphasized institutional changes to the labor market and the economy at large that have reduced the bargaining power of the less affluent and increased the bargaining power of the very rich (Jacobs and Dirlam 2016;Levy and Temin 2007;Volscho and Kelly 2012). These include the decline of the labor movement (Western and Rosenfeld 2011), lower minimum wages (DiNardo, Fortin, and Lemieux 1996;Lee 1999), decreasing enforcement of antitrust laws (Comanor and Smiley 1975;Khan and Vaheesan 2016), the lowering of trade barriers (Alderson and Nielsen 2002;Autor, Dorn, and Hanson 2016), and reductions in top income tax rates (Piketty, Saez, and Stantcheva 2014).…”

How Do Neoliberal Policies Affect Income Inequality? Exploring the Link Between Liberalization, Finance, and Inequality

“…First, finance incentivizes executives to engage in systematic layoffs, hiring of contingent labor, union busting, and investment in the automation of labor (Fligstein and Shin 2007;Kus 2012;Lin and Tomaskovic-Devey 2013). Second, finance-based activities increase the earnings of executives and upper-level management at the expense of workers (Duenhaupt 2013;Tomaskovic-Devey and Lin 2011;Volscho and Kelly 2012). Third, finance redistributes a larger proportion of national income to wealthy households by enhancing the role of investment income (Nau 2013;Volscho and Kelly 2012).…”

“…But there is reason to be skeptical. Specifically, there exists a robust literature which indicates that financial activity is an important determinant of income inequality in developed economies (Assa 2012;Bell and van Reenen 2013;Denk and Courn ede 2015;Godechot 2012;Goldstein 2012;Kus 2012;Kwon and Roberts 2015;Lin and Tomaskovic-Devey 2013;Nau 2013;Piketty 2014;Tomaskovic-Devey and Lin 2011;Volscho and Kelly 2012). Furthermore, many scholars stress how the recent rise of liberal economic policies tended to aid the growth of financial activity in developed economies over the past few decades (Davis 2009;Fligstein 1990;Krippner 2011).…”