Source: Edward N. Wolff, National Bureau of Economic Research, NBER Working Paper No. 24085, November 2017
From the abstract:
Asset prices plunged between 2007 and 2010 but then rebounded from 2010 to 2016. The most telling finding is that median wealth plummeted by 44 percent over years 2007 to 2010. The inequality of net worth, after almost two decades of little movement, went up sharply from 2007 to 2010, and relative indebtedness for the middle class expanded. The sharp fall in median net worth and the rise in overall wealth inequality over these years are largely traceable to the high leverage of middle class families and the high share of homes in their portfolio. Mean and median wealth rebounded from 2010 to 2016, by 17 and 28 percent, respectively. While mean wealth surpassed its previous peak in 2007, median wealth was still down by 34 percent. More than 100 percent of the recovery in both was due to a high return on wealth but this factor was offset by negative savings. Relative indebtedness continued to fall for the middle class from 2010 to 2016, and wealth inequality increased somewhat. The racial and ethnic disparity in wealth holdings widened considerably between 2007 and 2016, and the wealth of households under age 45 declined in relative terms.
Source: Michael Mazerov, Center on Budget and Policy Priorities, January 22, 2018
from the summary:
The deep income cuts that Kansas enacted in 2012 and 2013 for many business owners and other high-income Kansans failed to achieve their goal of boosting business formation and job creation, and lawmakers substantially repealed the tax cuts earlier this year. Former supporters have offered explanations for this failure to prevent the Kansas experience from discrediting “supply-side” economic strategies more broadly. But the evidence does not support these explanations. Rather, the Kansas experience adds to the already compelling evidence that cutting taxes does not improve state economic performance…..
Source: José Azar, Ioana Marinescu, Marshall I. Steinbaum, National Bureau of Economic Research, NBER Working Paper No. 24147, December 2017
From the abstract:
A product market is concentrated when a few firms dominate the market. Similarly, a labor market is concentrated when a few firms dominate hiring in the market. Using data from the leading employment website CareerBuilder.com, we calculate labor market concentration for over 8,000 geographic-occupational labor markets in the US. Based on the DOJ-FTC horizontal merger guidelines, the average market is highly concentrated. Using a panel IV regression, we show that going from the 25th percentile to the 75th percentile in concentration is associated with a 15-25% decline in posted wages, suggesting that concentration increases labor market power.
Source: Mark Zandi, Regional Financial Review, December 2017
These are good economic times. The 8½-year expansion is already the third longest in economic history, and it is in full swing. Strong job growth, rising wages, and synchronized growth around the globe will support the economy in 2018. The risk of recession remains low for the coming year.
Source: Adam Kamins, Regional Financial Review, December 2017
As the expansion matures and labor supply becomes a greater burden, wage pressures will grow more pronounced across regions. This will provide an additional jolt to consumers, who are already doing much of the heavy lifting this cycle. As in recent years, the West and the South will set the pace in the coming year, with income gains accelerating most rapidly in those areas.