Friday, February 04, 2011

Chart Week: Pareto Distribution and Wealth Inequality

The Pareto Distribution seems to play out in many different realms. Pareto's research revealed that over time, about 80% of the land holdings came under the control of about 20% of the populace.

Many observers see this as evidence of a "natural distribution" of wealth.

That may well be, but it doesn't explain the great concentration of wealth in the U.S. (and other nations) in the top 1% of the populace: that artifice results from specific tax and distribution policies established politically, not as a result of unfettered Capitalism or other "natural" distribution.

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