Debt as income substitute?

18 May 2009

I don’t have any statistics at hand, but an enterprising graduate student could do this. I have been wondering lately, whether overall inequality in the US would have increased or decreased if you include borrowing from housing and credit cards over the last 10 years. To what extent did borrowing substitute for real wage growth, which we know has been pretty stagnant over much of the distribution.

This seems like the kind of thing the folks at Center for American Progress or the Economic Policy Institute would be interested in doing…

Without some sustained and across the board real wage growth, it’s hard to see how things will improve for most people, even once the housing market eventually picks up.


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