Prof G Markets · Friday, August 14, 2026
Gabriel Zucman highlighted the significant shift in US tax policy starting in the 1980s, pointing to the reduction of the top marginal income tax rate from 70% in 1981 to 28% in 1986 under President Reagan. He argues this dramatic decrease was a major driver behind the rise in income and wealth concentration, particularly in the US.
“When Ronald Reagan entered the White House in 1981, the top marginal income tax rate for the highest earners in the US was 70%.”
“And then in 1986, there is the big Reagan tax reform and the top marginal tax rate is reduced to 28%.”
“And this has been one, not the only, but one of the main engines behind the rise of income and wealth concentration globally and the particularly fast rise of inequality in the US.”