"A Kuznets curve is the graphical representation of Simon Kuznets's hypothesis that economic inequality increases over time while a country is developing, and then after a certain average income is attained, inequality begins to decrease.
One theory as to why this happens states that in early stages of development, when investment in physical capital is the main mechanism of economic growth, inequality encourages growth by allocating resources towards those who save and invest the most. Whereas in mature economies human capital accrual, or an estimate of cost that has been incurred but not yet paid, takes the place of physical capital accrual as the main source of growth, and inequality slows growth by lowering education standards because poor people lack finance for their education in imperfect credit markets. "
Something else...see how easily this guy seems to accept the following study to come to the conclusion that the US is not an exceptional nation....regarding economic mobility:
“Perhaps the only legitimate use of the intergenerational correlation in income is to characterize economic mobility. The data challenge the notion that the United States is an exceptionally mobile society. If the United States stands out in comparison with other countries, it is in having a more static distribution of income across generations with fewer opportunities for advancement.
Anders Björklund of Stockholm University and Markus Jäntti of the University of Tampere in Finland, for example, find more economic mobility in Sweden than in the United States. Only South Africa and Britain have as little mobility across generations as the United States.”
http://www.j-bradford-delong.net/movable_type/refs/Mozilla_Scrapbook/2002-11-15-krueger.html
Where is his BALANCE with regard to citing studies that prove exactly the opposite?