Wednesday, June 08, 2005

"Much, much, much more money"

David Cay Johnson of the NYT wrote an excellent analysis headlined, "Richest Are Leaving Even the Rich Far Behind" as part of the paper's series on class and income disparities in the U.S.
For those such as Harvard economist Gregory Mankiw (I have one of his textbooks), a former chairman of the Council of Economic Advisers under Bush, who believe that the rich getting richer is necessary for economic growth, here's an important graph via Brad DeLong:

If increases in the top 1% income share were correlated with economic growth, we would see the dots lined up from the lower left corner to the upper right corner. The graph (click for larger image) shows no discernible correlation.


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