Ask HN: Will the US suffer any consequences for its high Gini coefficient?

2 points by newyearnewyou 8 years ago | 1 comment

The US has the 4th highest Gini coefficient of OECD countries [1] although it's remained fairly stable since 1992, it does demonstrate a slight uptrend [2]. How might this affect life for most Americans, particularly the middle class?

[1] http://www.oecd.org/social/income-distribution-database.htm [2] https://fred.stlouisfed.org/series/SIPOVGINIUSA

nabla9 8 years ago |

There is some evidence that income inequality raises the economic growth of poor countries and decreases the growth of high- and middle-income countries.

See for example this OECD Economics Department Working Paper http://www.oecd.org/economy/growth-and-inequality-close-rela...

or this https://voxeu.org/article/effects-income-inequality-economic...

>Specifically, we find that, on average, a 1 percentage point increase in the Gini coefficient reduces GDP per capita by around 1.1% over a five-year period; the long-run (cumulative) effect is larger and amounts to about -4.5%.