Financialization’s inequality effects accumulate gradually because income dynamics are highly persistent.
Evidence
It should be noted that the error correction rates in all models are fairly small, indicating that the dependent variables are persistent over time and the causal impact of the independent variables tends to spread slowly across the three dimensions of income dynamics. — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 122
Categorization
- SEED: The slow-spreading effect finding could anchor an essay on why financialization-driven inequality is hard to reverse quickly through policy.
- XREF: connects to: Counterfactual independence assumptions likely understate financialization’s true inequality impact — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 221; Capital returns exceeding economic growth rates drive extreme income divergence — Shoshana Zuboff, The Age of Surveillance Capitalism, 135
Related
- Counterfactual independence assumptions likely understate financialization’s true inequality impact (similarity 0.88)
- Financialization channels income toward the wealthy and depresses productive investment and wages. (similarity 0.85)
- Prior research linked financialization to inequality mostly indirectly, not causally. (similarity 0.84)
- Financialization independently explains over half of labor’s falling income share since 1970. (similarity 0.83)
- Financialization drives earnings inequality nearly as much as declining unionization (similarity 0.82)
- Financialization caused most of the decline in labor’s income share since 1970 (similarity 0.82)
- Inequality dimensions reflect one institutional shift toward financialization (similarity 0.81)
- Financialization raises earnings inequality across most US industries (similarity 0.80)
- Most earnings inequality growth occurred within industries, not between them. (similarity 0.79)
- Scholars asserted financialization’s existence without providing direct evidence (similarity 0.79)
- Declining industries show rising earnings inequality (similarity 0.79)
- Financialization theory links wage-compromise collapse and shareholder value to inequality (similarity 0.78)
- Financial-sector workers’ pay since the 1980s far outstripped national averages, driving inequality. (similarity 0.78)
- Financialization caused roughly three-quarters of the labor share decline by 1997. (similarity 0.78)
Broader Connections
- Counterfactual independence assumptions likely understate financialization’s true inequality impact
#qualifies(0.85) — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 221 - Capital returns exceeding economic growth rates drive extreme income divergence
#complicates(0.72) — Shoshana Zuboff, The Age of Surveillance Capitalism, 135