In relation to the growing inequality in income distribution in the U.S., I keep hearing claims that income inequality is economically harmful. But I keep hearing that from liberals without noticeable competence on economic matters, and I’m not noticing it from economists. Particularly I’m seeing it as a bald claim, with never a clear explanation of the causal mechanism by which income (or wealth) inequality causes economic harm.
But it’s an idea I’m willing to entertain, because I don’t know that it’s not true. So in the true spirit of intellectual laziness, instead of (or perhaps just prior to) researching it myself, I’d like to ask if anyone can point me toward explanations of how income inequality harms economic growth, particularly from economists, not social commentators (although I’d be curious to see their causal explanations as well).
I’ve got an excuse for my laziness. I’ve got a large stack of midterms to grade. First person to criticize me goes straight to the Bawdy Doghouse.