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A new study (abstract and free PDF available) authored by several economists at the IMF (International Monetary Fund) reveal an inverse relation between increases in inequality and GDP growth. In what could also be considered a heavy blow to trickle-down economic theory, data analyses show (page 7) that increases of income share on the fifth quintile actually hurt growth, while increases in any other quintile favours growth with the lowest quintile showing the strongest push.
From the abstract:
We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down. This suggests that policies need to be country specific but should focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class.
Original Submission
(Score: 1, Insightful) by Anonymous Coward on Saturday June 20 2015, @12:35AM
You remind me of the owner of my workplace. He talks just like you. He steals my wages - I'm not exaggerating, he modifies my time sheets because he feels that even though I worked through my meal break (for free, and in violation of the law) and my two ten minute breaks (also in violation of the law), and even though I just worked four hours for free, I'm not doing enough to earn $4 less than minimum wage.
Clearly, I'm just a lazy bludger, stealing from his $10 million yearly profit.
Those safety lights in the stairwell? Nobody needs those on. New equipment that actually works? Why? I can be blamed when it all breaks, and that helps.. well, with something.
As far as being a job creator, well, that's just not true. He makes $10 million a year because he creates those jobs, right? If it weren't for him, nobody would have anything to do, right?
Government funding pays for all of our wages, this "wealth creator" doesn't put a fucking penny up. Who bought all his equipment? The taxpayer. Of course, he bought second hand stuff that just won't last. He's relying on us to generate new ideas for him. Yes, that hour I didn't get paid for? I came up with ideas that will generate nearly half a million dollars in profit, to generate new wealth for him but I got nothing for it. Didn't even get paid for the hour I was labouring when I came up with them.
Well, that's too bad. He wants my ideas, he fucking pays me for each one. If I'm to be his wealth creator then he can give me 20% or just plain go without. Guess which he will choose - pay up or go without? He'll go without.
The loss of wealth is his problem. I've got my ideas on paper and I'm not able to use them because I'm owed about $65k in salary backpayments, so I will fucking well burn them. It'll keep me warm so I will profit from them. If he wants me to prop up his fortune, he can fuck off and die.
The sooner he dies, the better off we will all be.