Source: The EconomistCiting a study by Christian Broda and John Romalis, the Economist notes that the affluent have buy a different market basket of goods and services than do the poor, and the inflation of that purchased by the affluent has been greater than that of the goods and services purchased by the poor. This is a result of the fact that the poor buy more of the cheap consumer products, especially those flooding in from China, while the rich buy more expensive services such as medical care and education.
Thus while the dollar income distribution has gotten more uneven in the past decade, the Economist suggests that the poor have seen similar improvements in their ability to make purchases to those of the affluent. I would interpret this in a different way, inferring that the poor may find medical care and higher education still more difficult to afford than in the past.
The current inflation of fuel and food prices, and the long term devaluation of the dollar (see previous posting) suggest that the poor are not going to enjoy the increased buying power much longer if it has not already departed.
Thus while the dollar income distribution has gotten more uneven in the past decade, the Economist suggests that the poor have seen similar improvements in their ability to make purchases to those of the affluent. I would interpret this in a different way, inferring that the poor may find medical care and higher education still more difficult to afford than in the past.
The current inflation of fuel and food prices, and the long term devaluation of the dollar (see previous posting) suggest that the poor are not going to enjoy the increased buying power much longer if it has not already departed.
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