Rising Income Inequality and Economic Growth…Are Americans Better Off? Evidence from Subjective Well-Being Data
Year: 2020
Type: preprint
Abstract: A large portion of the real income gains from economic growth in the US since the 1970's have accrued to the top income quartile. We evaluate the equality-efficiency trade-off using subjective wellbeing data from the General Social Survey. Specifically, we estimate the parameter of inequality aversion within a neo-utilitarian framework of welfare analysis and calculate the Atkinson Inequality Index. We then use this to evaluate social welfare over the period 1974-2012. The analysis suggests that economic growth has been sufficient to raise social welfare despite the rising level of income inequality, but Americans have become more inequality averse over time.
Source: SSRN Electronic Journal
Authors: Boris Nikolaev, Daniel Bennett
Institution: Baylor University
Language: English
Subfield: Sociology and Political Science
Field: Social Sciences
Domain: Social Sciences
SDG: Reduced inequalities
Open Access status: green
OpenAlex ID: W3189003599