6 ms·
That's incorrect although an intuitive mistake. The situation A is actually better, for 90% of the people. The single outlier is not relevant when it comes to
by user5994461 7y ago
That's incorrect although an intuitive mistake.
The situation A is actually better, for 90% of the people.
The single outlier is not relevant when it comes to buying power, he doesn't move the market upward. Housing, food and commodities are needed by everyone so it's fixed by the 99% and accessible to everyone.
On the other hand, that's a new market class when there are enough participants like example B. They're going to compete with one another to get all the nicest houses, locations, cars, food, etc... that will be adjusted higher in proportion to what they can pay.
- SamReidHughes 7y agoThe people making more are producing more housing, food, and commodities.
- AceJohnny2 7y agoThey are not. The idea that they would be is called "Trickle-Down Economics" and it's been thoroughly debunked.
- refurb 7y agoBut that’s not observed at all. Despite the fact inequality is increasing, the average purchasing power is increasing overall. Sure, in some markets (limited supply of housing) more money just increases prices, but that’s an exception, not the rule.