What are the biggest factors that contribute to socioeconomic inequality today?
The truth is that even though there’s a lot of study devoted to inequality these days, we don’t fully understand what’s going on. Economists used to stress the demand for highly educated workers, but that doesn’t explain why incomes at the very top have soared so much.
At this point one good guess is that it has a lot to do with power, especially the decline of unions, which used to bargain for wages and also limit executive paychecks. Countries that still have strong unions, like Denmark, haven’t see as much of a rise in inequality as we have.