 The growth of US top income inequality: A hierarchical redistribution hypothesisBlair Fix No 2018/05, Working Papers on Capital as Power from Capital As Power - Toward a New Cosmology of Capitalism Abstract: What accounts for the growth of US top income inequality? This paper proposes a hierarchical redistribution hypothesis. The idea is that US firms have systematically redistributed income to the top of the corporate hierarchy. I test this hypothesis using a large scale hierarchy model of the US private sector. My method is to vary the rate that income scales with hierarchical rank within modeled firms. I find that this model is able to reproduce four intercorrelated US trends: (1) the growth of the top 1% income share; (2) the growth of the CEO pay ratio; (3) the growth of the dividends share of national income; and (4) the "fattening" of the entire income distribution tail. This result supports the hierarchical redistribution hypothesis. It is also consistent with the available empirical evidence on within-firm income redistribution. Keywords: top income share; inequality; hierarchy; power; functional income distribution; personal income distribution (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:zbw:capwps:201805 Access Statistics for this paper More papers in Working Papers on Capital as Power from Capital As Power - Toward a New Cosmology of Capitalism |
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