Inequality and risk-taking in a 21st-century economy
Edward Conard's contribution to e21's "Income Inequality in America: Fact and Fiction"

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Article Highlights

  • Understanding inequality requires proper measurement of both income and consumption.

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  • Information technology has opened an enormous window of investment opportunities and changed the nature of investment.

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  • The rewards for properly trained talent have risen despite a large productivity-driven increase in their supply.

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Understanding inequality requires proper measurement of both income and consumption, along with an understanding of the ever-changing determinates of income and its distribution. These determinates have changed significantly since the 1950s.

Information technology has opened an enormous window of investment opportunities and changed the nature of investment—from labor and capital-intensive manufacturing carried out by large companies, to idea-intensive opportunities like WhatsApp and Instagram. These opportunities require little unskilled labor and capital, and can be created and owned by individuals.

The rewards for properly trained talent have risen despite a large productivity-driven increase in their supply. This indicates investment opportunities have grown even faster than the productivity-enhanced supply of talent. 

 

 

Income Inequality in America: Fact and Fiction by American Enterprise Institute

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About the Author

 

Edward
Conard

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