Tag: superstar wages

Would a “Wealth Tax” Help Combat Inequality? A Debate with Saez, Summers, and Mankiw


Would these tech giants ever have become superstars if their founders had to sell down their controlling interests years ago to pay their wealth taxes

Top income shares falling since 1950s @FairnessNZ @CloserTogether

It has become an urban legend in New Zealand that inequality is getting worse and worse.

Brian Easton adjusted the top income share database for New Zealand for the introduction of dividend imputation. This encouraged companies to distribute more dividends.

top income is adjusted for dividend imputation

Once this measurement error was corrected by Easton, there has been no increase in top income shares in New Zealand since the 1950s. It has been a slow taper at best or a flat line.

There is a wages boom from the early 1990s after 20 years of wage stagnation, a period which some people regard as the good old days.

The return of real wages growth, and strong employment growth to boot, came straight after the Ruth Richardson horror budget and the passage of the Employment Contracts Act.

Every ethnic group experienced strong income growth as well as the graphic below shows. The rich got richer and the poor got richer too.

Lazy Australian top 0.1% only increased their income under @AustralianLabour

Australia’s top income earners are a lazy lot. The top 0.1% only ever had a rising income share under a Labor government in the 1980s. Even the top 1% had a pretty lean time until the 1990s.


Source: The World Wealth and Income Database.

How to show that unions & income inequality are unrelated when attempting to show a link

Fight for $15 tried to show a link between unions and rising income inequality but all it managed to show that unions went into decline several decades before inequality started to rise.

% Australian top incomes from wages, salaries and pensions since 1954

Australia has had a working rich for a long time now. Australian top income earners are top wage earners. They are athletes, celebrities, business executives and in the professions.


Source: The World Wealth and Income Database.

% US top incomes from wages, salaries and pensions, 1913 – 2015,

The rich in the USA long ago became a working rich; most top incomes are from wages and salaries.


Source: The World Wealth and Income Database.

The Economist Crony Capitalism Index


Few of the top 50 billionaires inherited their wealth

Of the 15 inheritance based billionaires, three are from the Walton family, two are the Koch brothers and another three are from the Mars family.


Source: The world’s top 50 billionaires: A demographic breakdown.

The decline and decline of the rentier class in the USA

Looks like the Reagan Revolution coincided with the American rich going out to work for a living. They started earning most of their incomes from wages, salaries and pensions or from entrepreneurial income. The American rich are now working rich; top wage earners, not top income earners.


Source: The World Wealth and Income Database.

% of top incomes from wages, salaries and pensions

Everybody from the top 10% to the top 0.01% have to work for their living these days with much of their income coming from wages.


Source: The World Wealth and Income Database.