Tax Cuts Don't Always Make Inequality Worse

Some of the biggest income gains for the top 1 percent in the U.S. have come when taxes were raised.

Enemy of the rich.

Photographer: Pradeep Gaur/mint/getty images

Why did the incomes of top earners rise so much after 1980? One reason was the boom in asset markets, which increased capital income from stocks and housing. But much of the gain was because the rich earned a lot more in salaries, bonuses and other labor income.

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