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Noah Smith

The Rich Get Hit Harder by Inflation Than the Poor

But there's no denying the social harm caused by rising income inequality.
The biggest cost of all for the rich.

The biggest cost of all for the rich.

Photographer: Victor J. Blue/Bloomberg

What if inequality isn't as bad as we've been led to believe? 

That is the upshot of new research by Juan Sanchez and Lijun Zhu of the Federal Reserve Bank of St. Louis. They looked at changes in the prices of various items, and they found that the things that poor people buy more of have gone up in price by a lot less than the things rich people buy more of.