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Wage Increases, Transfers, and the Socially Determined Income Distribution in the USA

Author

Listed:
  • Lance Taylor

    () (New School for Social Research)

  • Armon Rezai

    (Vienna University of Economics)

  • Rishabh Kumar

    (New School for Social Research)

  • Nelson Barbosa

    (São Paulo School of Economics)

  • Laura de Carvalho

    (São Paulo School of Economics)

Abstract

This paper is based on a social accounting matrix (SAM) which incorporates the size distribution of income based on data from the BEA national accounts, the widely discussed 2012 CBO distribution study, and BLS consumer surveys. Sources and uses of incomes are disaggregated by household groups including the top 1%. Their importance (including saving rates) differs markedly across households. The SAM reveals two transfer flows exceeding 10% of GDP via fiscal (broadly progressive) and financial (regressive) channels. A third major flow over time has been a ten percentage point increase in the GDP share of the top 1%. A simulation model is used to illustrate how “reasonable†modifications to tax/transfer programs and increasing low wages cannot offset the historical redistribution toward the well-to-do.

Suggested Citation

  • Lance Taylor & Armon Rezai & Rishabh Kumar & Nelson Barbosa & Laura de Carvalho, "undated". "Wage Increases, Transfers, and the Socially Determined Income Distribution in the USA," Working Papers Series 11, Institute for New Economic Thinking.
  • Handle: RePEc:thk:wpaper:11
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    File URL: http://ineteconomics.org/uploads/papers/WP11-Lance-Taylor.pdf
    File Function: First version, 2014
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    Cited by:

    1. Setterfield, Mark & Kim, Yun K., 2016. "Debt servicing, aggregate consumption, and growth," Structural Change and Economic Dynamics, Elsevier, vol. 36(C), pages 22-33.
    2. repec:mes:ijpoec:v:43:y:2014:i:3:p:4-17 is not listed on IDEAS
    3. repec:mes:ijpoec:v:43:y:2014:i:3:p:44-54 is not listed on IDEAS
    4. Lance Taylor & Özlem Ömer & Armon Rezai, "undated". "Wealth Concentration, Income Distribution, and Alternatives for the USA," Working Papers Series 17, Institute for New Economic Thinking.
    5. Rishabh Kumar, 2015. "Thrift, stagnation and wealth distribution in a two class economy with applications to the United States," Working Papers 1506, New School for Social Research, Department of Economics, revised Jul 2015.
    6. Mark Setterfield, 2015. "Time variation in the size of the multiplier: a Kalecki-Harrod approach," Working Papers 1522, New School for Social Research, Department of Economics, revised Jan 2017.
    7. repec:eee:ecolec:v:146:y:2018:i:c:p:164-172 is not listed on IDEAS

    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • B50 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - General

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