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Globally, there is Lakner and Milanovik (2015)'s elephant graph: Hellebrandt and Mauro (2015) Thus, the two previous distributions look like bimodal log-normal distributions. or CDFs, as in MacAskill's book Doing Good Better Did not find something strictly related to wages. For most of people, income may be a good proxy of wages.


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Equity capital = Assets − Liabilities. Market capitalization = Number of shares outstanding × Current share price.


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I do not believe that your suggested definitions will hold up. Since this is a forum for questions about economics, I do not see the point of proposing a new definition here. Who is going to see it? What you call “income generating wealth” is captured by “wealth” in its standard usages. However, what you exclude (such as bank deposits) will be included in “...


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Both distributions are often modelled log-normal, with a substantial number of zeros. A pareto distribution is also sometimes used (Piketty & Saez (2012), p.32) for modelling the distribution of top incomes. Wealth distributions are also in general far more skewed than wage (or income) distributions.


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The total assets of all US commercial banks are about \$17.2 trillion. You'll have to be clearer about what you mean by "their own money". The total equity capital of US commercial banks is about \$1.9 trillion.


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This depends on the exact preferences, but usually the utility function $$ U(x,y) = v(x) + y $$ is such that $$ \lim_{x \to 0} |MRS(x,y)| = \lim_{x \to 0} \frac{\text{d}v(x)}{\text{d} x} = \infty. $$ In this case it is the consumption of an additional marginal unit of the nonlinear good $x$ that is infinitely useful compared to the consumption of an ...


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(Mostly) ignore money for this growth issue; it's by and large a red herring that's distracting you. Instead just think of technological progress for instance. Assume everyone is washing their clothes by hand. That takes a fair bit of time. Now someone invents a washing machine. Everyone (who can get a washing machine) will then have more time on their ...


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The short answer is that money is not the same wealth. You yourself probably have less money than the value of all the stuff you own. When the economy grows the total amount of wealth grows. (This is usually also accompanied by growth of money, but that is a separate matter.)


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A random variable $X$ has a Pareto distribution with Pareto exponent $\theta$ if $$\text{P}(X>x)=\begin{cases} \left(\frac{x}{x_m}\right)^\theta \quad \text{ if } x\geq x_{min}\\ \ \ 1 \quad \quad \quad \text{ if } x<x_{min} \end{cases}$$ In this case, the Pareto exponent is $\theta = \alpha - 1$. Remember that $P(X>x)=\int_x^\infty p(x')\...


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The argument is correct Social Mobility and Income Inequality are simply two distinct phenomenons. Mobility is arguably the more complex one, and there are many different ways to define it. As an example, absolute mobility refers to someone earning more income in absolute terms (\$ per year), while relative mobility refers to someone earning more in ...


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Is it that the consumer would not consume anything of the nonlinear good in case of insufficient wealth? No, it is exactly the other way around. The utility function in the two goods case will have the following form: $$U(x,y)=u(x)+y$$ We assume that $u'(x)>0$ and $u''(x)<0$ or marginal utility of $x$ is decreasing in $x$. $MU_y$ meanwhile is ...


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Onurcanbektas, I really like your thought process. The problem with your mental model is that you've assumed economic output is exogenous. However, in the real world (most) jobs produce economic output. This output then increases the size of the pie, allowing people to be, on average, richer. However, from a societal perspective, I believe we will ...


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American economic theorist Henry George wrote about precisely this issue in his famous work Progress and Poverty published in the late 1800s, and based on his observations on the economic development of San Francisco during the gold rush. His argument was that increasing economic development primarily benefitted landowners, at the expense of both capital ...


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The distinction between the two is not well specified. If I own an apartment I can rent it out or I can live in it. If I own an art collection I can hang it in my house or charge others to see it. Cash in bank accounts is lent out by banks to form investments in other firms and projects. Land might be used for long walks or used for farming, natural resource ...


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If we view "wealth" as the subjective experience of pleasure, then "wealth" can spring up ex nihilo: if people used to get two dollars' worth of pleasure from having a cup, but now they get ten dollars' worth, then in some sense eight dollars of wealth has come "out of nowhere". However, it's more likely that at least one party has misvalued the cup. ...


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Even if $u^b$ is finite, it can never be achieved. This is what is meant by "does not attain a maximum". Rather, $u(x)$ approaches $u^b$ from below as $x \to \infty$. This is because $u$ is strictly increasing. If we had $u(x_*) = u^b$ for some $x_*$, then we would have $u(x_* + 1) > u^b$ and $u^b$ could not be a bound. This is why $U$ is written as the ...


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