Experience Stern | News & Events

Excerpt from Bloomberg -- "Before we find a policy solution, we have to understand the reason why there is this rising inequality. I think it's a combination of factors that are complicated. One is that technological innovation is becoming increasingly capital-intensive, skill-biased and labor saving. Eventually, the robots are going to replace lots of not just blue collar, but even white collar jobs. And, secondly, trade and globalization has lead to competition from Asia and other parts of the world for low-value-added, low-skill jobs, both in manufacturing but now in services... Third of all, there is this winner-take-all, superstar effect. If you are the best trader, the best banker, the best lawyer... of course you now have a market of potentially billions of consumers of your products and services. And therefore, they can enjoy more of the benefits of globalization. So there are many different factors that are leading to this concentration of income and wealth."

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