Tuesday, September 19, 2006

Who is getting rich

The pre-tax income gap between rich and poor is getting larger in the US because the very rich are getting even more rich. Steve Kaplan (one of my favorite professors from U Chicago) has a paper detailing exactly who, in this fortunate category, as seem a dramatic increase in their earnings. Kaplan looks at:
1) CEOs of regular "main street" companies
2) Wall Street
3) Guns for hire -- lawyers, celebrities, atheletes

These three groups make up less than 50% of the top income group, so CEOs, Wall Street fat cats, and basketball players do not explain the growth at the very top of the income scale -- they don't make up enough of it.

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