Falling Behind: How Rising Inequality Harms the Middle Class Book

I was initially skeptical that this book wouldn't be more than a polemic about the rich simply having too much, I was pleasantly surprised that it makes a lot of sense. An economist at Cornell, Robert Frank delivers a taught book (123 pages) that's all meat and no fluff, but with plenty of everyday examples to illustrate the ideas behind his economic arguments.

Everyone standing up from their seats at a concert to get a better view leaves no one better off than before (and now everyone has to stand). The middle 3 quintiles' income (income percentiles of 20-80%) has barely kept up with inflation since the mid 1970s with a good deal of these gains coming from more women entering the workforce. Despite this stagnation, home prices have skyrocketed leaving people to devote ever increasing shares of their income to housing. The cause of this, Frank asserts, is a sort of 'consumption cascade' where the almost superrich try to keep up with the superrich and so on down the consumption spiral. We would all be better off limiting the size/cost of our house and using the money for goods we need that aren't so sensitive to what other people have, such as leisure time. I'll let Frank explain the logic but know that he does it clearly, concisely and convincingly. Non-students of economics, this book is not over your head.