by Aparna Mathur
American Enterprise Institute
September 27, 2013
So after decades of research on income inequality, do we really know where we stand? The standard narrative that rising income inequality has somehow hurt the middle and lower income classes is not supported by data. Whether the explanation for improvement in living standards lies in redistribution policies and the growth of the safety net, or technological improvements that allowed prices of electronics and other durable goods to drop, or real improvements in productivity and wages, the bottom line is: people are better off today than they were twenty or thirty years ago. Households are consuming more and the typical low income household possesses many more appliances and gadgets that have traditionally been considered the preserve of the rich, than at any time in history. Judging by these criteria, inequality is much less of a predicament than most politicians would have you believe.

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