How Rich Is Too Rich?: Income and Wealth in America [Hardcover]

Herbert Inhaber (Author), Sidney Carroll (Author)

Book Description

ISBN-10: 0275936198 | ISBN-13: 978-0275936198 | Publication Date: January 30, 1992

A physicist and an economist, writing for a broad audience and using real--not theoretical--data, answer the age-old question: How rich is too rich? In the process, they suggest some practical solutions to the problem of excessive wealth. They outline a way to deal with the "too" rich that will also create a healthier economy. Merging a hundred years of economic theory and research on wealth and income distributions with anecdotal evidence, Herbert Inhaber and Sidney Carroll create a framework with which to evaluate proposals to redistribute great wealth and income. The authors set forth an "Alternative Distribution System," based on the fact that much of the income of the well-off, that upper 3 percent of the United States population with incomes exceeding $110,000 per year, is due to wealth. The ADS, an inheritance plan, would bring the distribution of the lower 97 percent and the upper 3 percent closer together. It would allow a partial correction of the disparity while adding to the total fairness of our society. This very readable text is complemented by a dozen tables that illustrate "The Power of Compound Interest," "United States Income Distribution," "The Estimated Size of the Domestic Underground Economy," and more. Inhaber and Carroll first describe the existence of an extremely unequal distribution of income and wealth, with enormous resources held by a small percentage of Americans at the top. Other chapters detail the law of income distribution, explain the difference between wealth and income, and explain previous theories of income and wealth distributions. In addition to defining and describing the rich, the authors devote a chapter to how the rich avoid income tax. The volume concludes with an examination of the Alternative Distribution System and how income would be altered by it. How Rich Is Too Rich? will enable the informed general reader to assess policies on wealth and income distribution that have been the subject of Congressional budget debates and best-selling books.

Editorial Reviews

Review

“Arguable as are the conclusions and recommendations for tax change, the economist and physicist authors nevertheless offer a sprightly, chucklesome, readable account of how and why income and wealth in the US has been and is tilted in favor of the top three percent of the population, the so-called rich. The top-heavy, more-than-proportional income and wealth concentration--graphically shown by an upward kink for the highest groups of the income distribution--is statistically affirmed for the US and is especially attributed to the amassment and inheritence of wealth permitted by the tax structure (an assertion unsupported by a large percentage of new names among those revealed annually to be among the richest). To reduce the kink, the authors propose an Alternative Distribution System consisting of taxing inheritance (not estates) at a highly progressive rate, though permitting a tax-free one million dollars. This is said to provide incentives for tax-free gifts by the very wealthy to their inheritors, to be used for investment. Aside from the dubious proposition that sloshing around savings and wealth among the rich would stimulate investment, the increased share of wealth and income at the top raises important equity considerations. Both general readers and economists will find enjoyment in this book, though it will provoke argument. Academic and public library collections.”–Choice

“This unlikely combination of authors--physicist Inhaber and economist Carroll--comes up with a new twist on the eternal question of inequitable income distribution, though they focus on wealth (accumulated income) rather than income. The authors document the dramatic disparities in the distributions of income and wealth and describe the problems these cause. Their solution, the "alternative distribution system" is quite simple: tax inheritance rather than estates. Individuals could inherit up to $1 million tax free. Each succeeding million would be taxed at progressively higher rates. This plan, they argue, would force an estate to be distributed among more people and would cuase beneficiaries to use inheritances more `vigorously and creatively.' The authors do an excellent job of making obscure economic data understandable.”–Booklist

“[An] excellent book . . . Conservative, and yet far from trivial in its effect. If [their] proposals cannot succeed politically then I think nothing will be possible on this front short of a revolution.”–Herman Daly Senior Economist, World Bank

About the Author

HERBERT INHABER is a Research Scientist at the Harry Reid Research Center at the University of Nevada-Las Vegas. He is a physicist and author of several books. His interest in distributions led him to this book.

SIDNEY CARROLL is Professor of Economics at the University of Tennessee at Knoxville.

Product Details

• Hardcover: 264 pages
• Publisher: Praeger Publishers (January 30, 1992)
• Language: English
• ISBN-10: 0275936198
• ISBN-13: 978-0275936198
• Product Dimensions: 9.6 x 6.5 x 1 inches
• Shipping Weight: 1.4 pounds
• Amazon Best Sellers Rank: #1,354,969 in Books (See Top 100 in Books)

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