Questions tagged [wealth]

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24 views

How does the pie get larger?

I understand the concept of creation of wealth through trade, innovation, labor and capital. New value is being added to the economy. Let's imagine for a second that there are no central banks and the ...
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1answer
35 views

What is the difference between a power law exponent and the Pareto exponent?

I use the poweRlaw package in R to fit a power law to my data. I am trying to figure out what is the value of the Pareto exponent. Assume the probability mass function is defined by: $$ p(x) = \...
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1answer
31 views

Social mobility and income inequality

I once read an argument by the libertarian economist Thomas Sowell against the conventional wisdom that rising income is bad because most statistics which show rising income inequality do not account ...
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2answers
93 views

Assumption of sufficient wealth in quasi-linear preferences

Whenever we talk about quasi-linear preferences, we assume that the consumer is sufficiently wealthy. As far as I understand is that we need that assumption in order to obtain an interior solution. ...
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3answers
179 views

Is poverty a mathematical necessity?

I recently saw a meme, and the content was something like: In the near future, a meteor will 'hit' the Earth, and there will be gold rain, and hence everyone will be rich The ridiculous thing ...
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Question about the effect on economic productivity due to a hypothetical wealth distribution requirement

Assume a sovereign state that functions like a joint stock corporation does: it will be comprised of shareholders and its "stateshares" will have a market value since they are tradeable. Now assume ...
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0answers
8 views

Unit of analysis for income distribution, adult equivilence

Over the last few years I have seen a number of tussles over income distribution measurement in the economics journal literature between people drawing data from different sources and maintaining that ...
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1answer
26 views

What's the difference between equity capital and market capitalization?

Is there any difference between the equity capital and the market capitalization of a company (or a bank)? If yes then what's the difference?
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2answers
63 views

Is there a term for the personal wealth that is not used to generate income?

A rich person can own companies, shares, houses used for renting etc. that are worth billions of $US. That is the wealth that is generating income. I would call it income-generating wealth or income+...
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1answer
23 views

What's the combined wealth of the US banks?

How much is the amount of money of the US banks? In terms of: assets their own money (the banks make profits and they can keep the profits for further investments) The question is only about the ...
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0answers
23 views

What are the definitions of the terms value, wealth, and utility in economics?

Are there any definitions for the following three terms that are widely agreed upon in economics? Value Wealth Utility In particular, are these terms identical? If not, what differentiates them? I ...
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2answers
61 views

Statistical distribution of wages and wealth

How are wages distributed globally? Wages do not follow a normal distribution, do they? Is wealth distributed in the same way or differently?
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1answer
147 views

The relationship between indirect utility and expenditure functions

I am trying to understand the fact that $e(p, v(p,y)) = y$. There is a proof in the text Advanced Microeconomic Theory (Jehle and Reny) that states the following: Because $u(·)$ is strictly ...
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1answer
82 views

How do we determine if wealth will be created or destroyed (and how much) when we want to provide (quasi)public goods?

It seems quite simple under framework of free market, when there are no taxes or subsidies,price celling or price floors, etc, that can mess up the market: if there is profit (or will be, according to ...
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1answer
92 views

Wealth Creation: Where does the money come from?

I'm trying to better understand wealth creation– let's use trade as an example. I've bought a cup for \$2 and sold it for \$10. We've "created some new wealth" there– but without a net increase in ...
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2answers
53 views

Should mean wages increase with inflation?

Should mean wages increase with inflation? If not, why? Has this profound consequences in the redistribution of wealth? (not an expert in economics...I apologise is the question is too naif)
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4answers
224 views

Printing money to redistribute wealth

A fictional country has 100 people. The total printed money is $2000. Ten rich people own half of it ($100 each), the remaining ...
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4answers
125 views

Is wealth inequality actually a problem

I have been searching around online, but cannot really find an answer to my question. I can find a lot of material covering wealth inequality and how it has developed over time, but haven’t found any ...
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1answer
48 views

Why have trickle-down economics failed to trickle down to the middle-class and poor in recent years?

Trickle-down economics, also referred to as trickle-down theory, is an economic theory that advocates reducing taxes on businesses and the wealthy in society as a means to stimulate business ...
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1answer
52 views

How much the wealth inequality increased in the USA in the last decades?

Are there any studies trying to measure the increase of the wealth inequality in the USA? Say for example how much it increased, comparing with 1990. Or compared with any other moment in time after ...
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1answer
5k views

How is wealth created? [duplicate]

The production of 'goods and services' and 'innovation' is the usual answer. I feel that doesn't really answer the question. These things can be traded for wealth but they don't generate new wealth. ...
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2answers
199 views

Is worsening wealth inequality intrinsic to Capitalism?

I am but a humble lay person, but I have a question. I've been thinking about wealth inequality and the structure of capitalism. It seems to me that the pay rate for workers accumulates in a linear ...
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2answers
435 views

Did the idea of “making money” originate in the United States?

I am currently reading Atlas Shrugged by Ayn Rand and I came across an interesting paragraph related to Economics and American History. If you ask me to name the proudest distinction of Americans, ...
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1answer
34 views

Estimating national intangible wealth

I seem to recall reading about the following research regarding "national intangible wealth" (IIRC): For each country, compute the GDP. Convert the GDP to "total national capital" using an interest ...
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4answers
313 views

How is money created?

This might seem like a really simple question, but I am really troubled by it on a macro scale. The money has to come from somewhere. Someone might start up a business that creates things or takes ...
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1answer
71 views

Effects of finding infinite gold reserve

Suppose an infinite reserve of gold was found. What would be the consequences to the economy in general. Would it have major negative effects?
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2answers
80 views

if the richest 85 people give away all their money?

I once heard a fact that the richest 85 people are as wealthy as half the world's population put together. My question is, what does that mean? Does it mean that there is some feasible method in ...
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1answer
166 views

Meaning of innovation in the wealth creation process

Is there a formal definition or measure of wealth that captures the notion that with improving technology "life gets better"? A stupid example of what I mean would be the invention of the iPhone. I ...
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3answers
125 views

How to tax the robots?

The Socialist candidate for the upcoming presidential elections Benoit Hamon says he wants to roll out the Universal Basic Income in France, to be paid by "taxing the wealth created by robots" (for ...