Amidst all talk about the 1%, we overlook the fact that there exists considerable variation in the trends among them. While incomes shares of the 1-0.1% have been relatively stable, the real surge has been in the share of the top 0.1%, in particular the top 0.01%.
The near quadrupling of the wealth share of the top 0.01% has come mainly from ownership of equity and fixed income security assets, or in other words from returns on capital.
But for the bottom 90%, the share of equities and fixed income securities is virtually zero.
Expectedly, this trend has paralleled a near doubling of corporate profits as a share of GDP over just the last decade.
Even as the share of income going to labor has been declining, not just in US, but across the world. In America, labor's share of income has fallen 3.9 percentage points over the last quarter century. Trade, globalization, technology, and labor market deregulation have all contributed to this trend.
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