Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/196154
Authors: 
Fix, Blair
Year of Publication: 
2019
Series/Report no.: 
Working Papers on Capital as Power 2019/02
Abstract: 
What makes the rich different? Are they more productive, as mainstream economists claim? I offer another explanation. What makes the rich different, I propose, is hierarchical power. The rich command hierarchies. The poor do not. It is this greater control over subordinates, I hypothesize, that explains the income and class of the very rich. I test this idea using evidence from US CEOs. I find that the relative income of CEOs increases with their hierarchical power, as does the capitalist portion of their income. This suggests that among CEOs, both income size and income class relate to hierarchical power. I then use a numerical model to test if the CEO evidence extends to the US general public. The model suggest that this is plausible. Using this model, I infer the relation between income size, income class, and hierarchical power among the US public. The results suggests that behind the income and class of the very rich lies immense hierarchical power.
Subjects: 
hierarchy
power
functional income distribution
personal income distribution
inequality
capital as power
class
JEL: 
D31
D33
B5
URL of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc-nd/4.0/
Document Type: 
Working Paper
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