The Rise of the Super-Rich

2012/09/30 by Thomas W. Volscho, Nathan J. Kelly · 13 citations
Economics, Econometrics and Finance · Business, Management and Accounting · #Economic Theory and Policy #Financial Literacy, Pension, Retirement Analysis #Monetary Policy and Economic Impact

paper · doi:10.1177/0003122412458508

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 short-run 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.

Citations

• Social Democracy, Christian Democracy, Constitutional Structure, and the Welfare State
• Co-Integration and Error Correction: Representation, Estimation, and Testing
• Politics, Institutions, and Welfare Spending in Industrialized Democracies, 1960–82

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