Empirical evidence Quote by Adair Turner, Baron Turner of Ecchinswell
“The richer people, when they get another $100,000, or another million, or 10 million, don't tend to spend it as much as the poorer people would if they got another $100 or $1,000 or $5,000. All the empirical evidence suggests that the rich tend to consume a lower proportion of income than middle and lower-income people.”
About This Quote
Source Speech: 2015, World Economic Forum, “Wealth and Consumption”
Wealthier individuals allocate a smaller share of additional income to consumption compared to lower‑income groups, reflecting diminishing marginal propensity to spend.
In simple terms: Rich spend less proportionally than poor when they get more money.
Key Takeaway
Recognize that income growth doesn't guarantee proportional consumption.
Themes
economics
wealth inequality
consumer behavior
public policy
behavioral finance
Mood
analytical
concerned
neutral
Type
policy
educational
When to use this quote
- budget planning
- tax policy design
- financial education
- marketing strategies
Key Concepts
marginal propensity to consume
income elasticity
social stratification
Questions to Reflect On
- Why do richer people save more of extra income?
- How can policy address consumption gaps?
A Different Perspective
Higher income may still lead to increased absolute spending despite lower proportion.
