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This brilliant infographic is from March 2014 but still worth sharing. It was originally published at Cryptocoins News 
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Income inequality must have become a mainstream concern because even business leaders worry about it. A newly released survey by theHarvard Business School of its alumni about American competitiveness shows that a “troubling divergence in the American economy” could ultimately sink the country’s prospects. Even as large corporations, the wealthy, and “ highly skilled individuals” prosper, “middle-class and working-class citizens are struggling.” So are small businesses, which are an important source of new jobs. The result is a division of the U.S. into two parts, one small and wealthy, the other comprising the vast majority that finds it more difficult to get by as time moves on.
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Razmig Keucheyan: Debt audits show that austerity is politically motivated to favour social elites. Is a new working-class internationalism in the air?
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There are several things. There’s some debate about this, but I think most readers of Thomas Piketty’s book (Capital in the Twenty-First Century) get the impression that the accumulation of wealth — savings —is responsible for the rise in inequality and that there is, therefore, in a way,a link between the growth of the economy — the accumulation of capital— on the one hand and inequality and wealth. My paper begins with the observation that in fact, you cannot explain what has happened to the wealth/income ratio by that analysis. A closer look at what has gone on suggests that a large fraction of the increase in wealth is an increase in the value of land, not in the amount of capital goods.
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Across the board, the more CEOs get paid, the worse their companies do over the next three years, according to extensive new research. This is true whether they’re CEOs at the highest end of the pay spectrum or the lowest. “The more CEOs are paid, the worse the firm does over the next three years, as far as stock performance and even accounting performance,” says one of the authors of the study, Michael Cooper of the University of Utah’s David Eccles School of Business.
Eli Levine's curator insight,
June 17, 2014 9:13 PM
Interesting.
It's been known that, in fields of work that require cognition, being paid higher amounts actually decreases production and overall performance. The conclusion that was reached in the study (which was done in Harvard and replicated in India) is that you pay people in top, cognitive positions enough money to make it not be a concern for them in order to maximize productivity. The same study also found that, for menial tasks, being paid more increased productivity and performance.
If you want to figure out how to configure compensation packages in your company to maximize performance, here is the data to show you the general principles of what needs to be done. Minimum wages are good, but too high of a minimum wage will kill small companies and start ups. Once you have a solid revenue stream established, it makes sense, based on the research, to divvy up the funds equitably amongst the white collar and blue collar employees, such that the white collar folks, especially on top, get paid a smaller ratio in proportion to the blue collar workers. After all, you can only have so much wealth and derive so much well being from that wealth. What's the point of spoiling productivity in your own company for the sake of it, let alone, for the sake of the whole economy that will benefit from having wealth be significantly more equitably distributed to all of those who produce the wealth?
It's not like a McDonalds or Starbucks job is actually all that easy a job to do. Those who think otherwise clearly never worked or have forgotten what it was like to work in cramped, hot, fast paced environments dealing with the general public.
The science is there. Whether anyone will listen to it without some coercion is another issue.
Think about it.
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“It’s been clear to me that our economy has been sick for a long time,” he began, introducing a theme he would hammer home throughout the speech. “For too long, the hardworking and rule-abiding had seen their paychecks shrink or stay the same, while the rule-breakers raked in huge profits and wealth,” he said. “It made our economy sick, and our politics sick, too.”
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