Thomas Piketty empirically shows that the top 1% cohort rakes in 20%+ of U.S. national income.

Daisy Harvey

2018-09-01 07:34:00 Sat ET

As the French economist who studies global economic inequality in his recent book *Capital in the New Century*, Thomas Piketty co-authors with John Bates Clark medal winner and Berkeley professor Emmanuel Saez the latest September 2018 World Inequality Report. This fresh report empirically demonstrates that the rise of income-and-wealth for the top 1% U.S. population mirrors the fall of income-and-wealth for the bottom 50% U.S. population. Specifically, the top 1% cohort rakes in more than 20% of U.S. national income in 2017 in comparison to only 11% back in 1980. At the same time, the bottom 50% cohort receives 12% of U.S. national income in 2017 in comparison to about 20% back in 1980.

Not only do the rich become richer and the poor become poorer, the income and wealth transfers seem simultaneous, synchronous, and causal in time-series data. This stark feature shows an empirically robust increase in U.S. economic inequality over the recent decades.

However, this socioeconomic issue cannot reflect talent concentration in specific labor markets. At least some of this dichotomous wealth inequality arises from the fact that several industries such as biotech, telecom, and social media mold large players with competitive moats into quasi-monopolies. These mega players invest heavily in patents, trademarks, copyrights, and other intellectual properties in order to safeguard their market dominance against external competitive forces.

Nobel Laureate and former chief economist at World Bank Joseph Stiglitz points out that tech titans have become quasi-monopolies with high market concentration. This concentration serves as a primary explanation for worse income and wealth inequality in America. When the network platform orchestrators such as Facebook, Apple, Microsoft, Google, Amazon, Netflix, and Twitter (FAMGANT) reinforce their market strength and dominance, they may violate antitrust laws and regulations. Also, several other industries such as pharmaceutical firms (Johnson & Johnson, Merck, and Pfizer etc) and telecoms (AT&T, Verizon, Sprint, and T-Mobile) are new additions to the checklist of U.S. quasi-monopolies.

This new technological trend aggravates socioeconomic inequality, deepens anti-competitive concerns, and harms consumer benefits in terms of longer-term price and quality improvements.

 


If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.

Blog+More

U.K. prime minister Boris Johnson encounters Brexit defeat during his new premiership.

Chanel Holden

2019-10-15 09:13:00 Tuesday ET

U.K. prime minister Boris Johnson encounters Brexit defeat during his new premiership.

U.K. prime minister Boris Johnson encounters defeat during his new premiership. The first major vote would pave the path of least resistance to passing a no

+See More

Andy Yeh Alpha (AYA) fintech network platform: major milestones, key product features, and online social media services

Joseph Corr

2026-01-19 10:30:00 Monday ET

Andy Yeh Alpha (AYA) fintech network platform: major milestones, key product features, and online social media services

  Andy Yeh Alpha (AYA) fintech network platform: major milestones, key product features, and online social media services   Introduction

+See More

Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology.

Jonah Whanau

2018-12-17 08:43:00 Monday ET

Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology.

Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology. This recent ban of

+See More

President Trump criticizes the potential media merger between AT&T and Time Warner.

Chanel Holden

2017-11-05 09:45:00 Sunday ET

President Trump criticizes the potential media merger between AT&T and Time Warner.

President Trump criticizes the potential media merger between AT&T and Time Warner, the latter of which owns the anti-Trump media network CNN. President

+See More

AT&T wins court approval to take over Time Warner with a trademark $85 billion bid despite the Trump prior dissent due to antitrust concerns.

Chanel Holden

2018-06-07 10:36:00 Thursday ET

AT&T wins court approval to take over Time Warner with a trademark $85 billion bid despite the Trump prior dissent due to antitrust concerns.

AT&T wins court approval to take over Time Warner with a trademark $85 billion bid despite the Trump administration prior dissent due to antitrust conce

+See More

Federal Reserve's interest rate hike may lead to an economic recession as credit supply growth ebbs and flows through the business cycle.

Monica McNeil

2018-06-14 10:35:00 Thursday ET

Federal Reserve's interest rate hike may lead to an economic recession as credit supply growth ebbs and flows through the business cycle.

The Federal Reserve's current interest rate hike may lead to the next economic recession as credit supply growth ebbs and flows through the business cyc

+See More