LC Posted June 17, 2020 Share Posted June 17, 2020 https://www.npr.org/2020/06/17/878946307/the-rich-have-stopped-spending-and-thats-tanked-the-economy In fact, so much of the country's economy depends on shopping by the top income bracket that the wealthiest 25% of Americans account for fully two-thirds of the total decline in spending since January. They have a lot of discretionary income and before the pandemic were spending a significant chunk of that going to nice restaurants, the theater, or traveling and staying in nice hotels. Those are precisely the things that have been off-limits since the coronavirus hit. That makes this very different from an ordinary recession, when spending on higher-touch services doesn't dry up so quickly. And those experiences are usually a lot more expensive than food and other essential items, which the rich and poor alike have continued to spend on, but also make up a smaller portion of upper-income household budgets. Hendren and his colleagues found that businesses that deliver in-person services in wealthy neighborhoods have seen the biggest drop in sales and are struggling to recover, while a retail store or takeout restaurant in a poorer neighborhood might have seen some decline but is starting to come back now. An interesting implication as the wealth inequality gap widens. Link to comment Share on other sites More sharing options...
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