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Justin Fox

Why Economists Took So Long to Focus on Inequality

Income stagnation finally got their attention.
It was nice when no one was paying attention.

It was nice when no one was paying attention.

Source: Topical Press Agency/Getty Images

In the early 1980s, the share of earnings going to those at the very top of the income distribution in the U.S. -- the 1 percent -- began to rise a lot. For two decades, the economics profession barely noticed.

Then, in the early 2000s, Thomas Piketty of the Paris School of Economics and Emanuel Saez of the University of California-Berkeley began releasing evidence, gleaned from Internal Revenue Service data, that top earners’ share had doubled since 1980, and was higher than at any time since the Great Depression.  Their data showed even more dramatic gains higher up on the scale -- the share of income going to those in the top 0.1 percent had more than tripled in the 1980s and 1990s, while the share going to the top 0.01 percent had almost quadrupled.
Income Inequality