After becoming aware of the class conflict issue in America, I was curious to see what class structures in other countries look like and how the United States stands in comparison. It can be easy to dismiss the presence of class inequality in the United States as an inevitability of capitalist economic structures however; there is evidence to suggest that this is not the case for other countries. After reading The Top 1 Percent in International and Historical Perspective I realized that the increase of income in the top 1 percent of the United States is dramatic in comparison to other countries with similar economic structures. In fact, the majority of other high-income countries (such as Canada, Germany, Japan, Australia and Sweden) have seen comparatively modest increases in the income of their upper classes in recent years (Alvaredo, Atkinson, Piketty, Saez 18).
This lack of similarity indicates that income inequality in the United States is a result of other institutional factors. “The fact the high-income countries with similar technical and productivity developments have gone through different patterns of income inequality at the very top supports the view that institutional and policy differences play a key role in these transformations. Purely technological stories based solely upon supply and demand can hardy display such diverging patterns” (Alvaredo, Atkinson, Piketty, Saez 5). The article concludes that income inequality in the United States is powerfully shaped by the following factors: tax policy, a richer view of the labor market and the correlation between earned income and capital income. For more information on these factors, see the article here:
http://eml.berkeley.edu/~saez/alvaredo-atkinson-piketty-saezJEP13top1percent.pdf
In conclusion, it would be unreasonable to say that the income inequality in the United States is simply due to the fact that we are an advanced country. There are other institutional and political factors at work that have caused a dramatic increase of wealth in the upper-class. Although we cannot look to other similar countries for an explanation as to why this disparity exists, we can look to their economic structures for examples on how we can alleviate issues of class inequality in America.
Resources:
Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty, and Emmanuel Saez. 2013. "The Top 1 Percent in International and Historical Perspective." Journal of Economic Perspectives, 27(3): 320.
This lack of similarity indicates that income inequality in the United States is a result of other institutional factors. “The fact the high-income countries with similar technical and productivity developments have gone through different patterns of income inequality at the very top supports the view that institutional and policy differences play a key role in these transformations. Purely technological stories based solely upon supply and demand can hardy display such diverging patterns” (Alvaredo, Atkinson, Piketty, Saez 5). The article concludes that income inequality in the United States is powerfully shaped by the following factors: tax policy, a richer view of the labor market and the correlation between earned income and capital income. For more information on these factors, see the article here:
http://eml.berkeley.edu/~saez/alvaredo-atkinson-piketty-saezJEP13top1percent.pdf
In conclusion, it would be unreasonable to say that the income inequality in the United States is simply due to the fact that we are an advanced country. There are other institutional and political factors at work that have caused a dramatic increase of wealth in the upper-class. Although we cannot look to other similar countries for an explanation as to why this disparity exists, we can look to their economic structures for examples on how we can alleviate issues of class inequality in America.
Resources:
Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty, and Emmanuel Saez. 2013. "The Top 1 Percent in International and Historical Perspective." Journal of Economic Perspectives, 27(3): 320.