Summary of Inequality in 3-D

Looking for the report?
We have the summary! Get the key insights in just 5 minutes.

Inequality in 3-D summary
Start getting smarter:
or see our plans

Rating

8 Overall

8 Importance

9 Innovation

7 Style


Recommendation

Economists and politicians sound an increasingly loud alarm about growing income inequality in the advanced countries, particularly in the United States. Yet household income gaps are just one facet of overall “economic inequality,” which also includes differences in individuals’ consumption and wealth. Economists Jonathan Fisher, David Johnson, Timothy Smeeding and Jeffrey Thompson take a new approach in assessing people’s overall economic well-being. This scholarly report for analysts and policy experts highlights a trajectory of rising inequality.

In this summary, you will learn

  • Why three-dimensional models of income, wealth and consumption are the best measures of “economic inequality” and
  • What economic inequality looks like in the United States.
 

About the Authors

The authors are economists at Stanford University, the University of Michigan, the University of Wisconsin and the Federal Reserve Board of Governors.

 

Summary

While growth has returned to the US economy after the Great Recession, one area that has not seen improvement, but rather experienced regression, was income inequality. Wage disparities are a serious issue, but economically important discrepancies also occur in households’ net worth and their “total spending on goods and services for current consumption.” The three aspects of income, wealth and consumption together can provide the fullest understanding of a country’s economic security. Indicators of how these factors interact can increase the accuracy of macroeconomic models. Researchers have developed new multidimensional measures of the three components of “economic inequality,” based primarily on US data from 1989 to 2016.


More on this topic

By the same authors

Changes in U.S. Family Finances from 2010 to 2013
Changes in U.S. Family Finances from 2010 to 2013
7

Customers who read this summary also read

Economic Growth in the US
Economic Growth in the US
9
The Science Is In: Greater Equality Makes Societies Healthier
The Science Is In: Greater Equality Makes Societies Healthier
9
Global income inequality is declining – largely thanks to China and India
Global income inequality is declining – largely thanks to China and India
8
Is Global Equality the Enemy of National Equality?
Is Global Equality the Enemy of National Equality?
8
Is the Solution to Extreme Wealth Inequality Really – Alaska?
Is the Solution to Extreme Wealth Inequality Really – Alaska?
9
Market Capitalism Should Benefit the Many, Not Just the Few
Market Capitalism Should Benefit the Many, Not Just the Few
8

Comment on this summary