Investment Income v. Labour Income

DT Cochrane
Aug 24, 2017 · 1 min read

In a previous post I showed the divergence between median income and GDP per capita. I noted that one reason this can happen is because non-income components of GDP can grow more than income. It is more precise to distinguish the different types of income, as I have done here. As seen above, investment income has grown much more than labour income.

This is part of the reason that income distribution in the United States has grown worse over the past four decades.

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DT Cochrane
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