Research report The Remarkable Constancy in the Income Share of Corporate Capital
C. Eugene Steuerle
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Despite a brief upturn in the early- to mid-1990s, the profits of nonfinancial corporations have dropped dramatically as a percentage of GDP in recent decades and are near an all-time low. Does this mean that owners of corporate capital are worse off? Not necessarily. The owners of corporations have retained a remarkably stable share of the nation's product. To see this constancy, one needs to consider all the returns to capital - not only retained earnings and dividends, but also the net interest payment received by corporate bond owners - and to understand how inflation affects the various components.
Primary topic Business Taxes
Research Area Business Taxes Federal Budget and Economy