Question

What was the impact of economic growth on the united states

Answer 1

The rise of economic inequality is one of the most hotly debated issues today in the United States and indeed in the world. Yet economists and policymakers alike face important limitations when trying to measure and understand the rise of inequality.

One major problem is the disconnect between macroeconomics and the study of economic inequality. Macroeconomics relies on national accounts data to study the growth of national income while the study of inequality relies on individual or household income, survey and tax data. Ideally all three sets of data should be consistent, but they are not. The total flow of income reported by households in survey or tax data adds up to barely 60 percent of the national income recorded in the national accounts, with this gap increasing over the past several decades.1

This disconnect between the different data sets makes it hard to address important economic and policy questions, such as:

What fraction of economic growth accrues to those in the bottom 50 percent, the middle 40 percent, and the top 10 percent of the income distribution?
What part of the rise in inequality is due to to changes in the share of national income that goes to workers (labor income) and owners (capital income) versus changes in how these labor and capital incomes are distributed among individuals?