Plutonomy

AAA

DEFINITION of 'Plutonomy'

Economic growth that is powered and consumed by the wealthiest upper class of society. Plutonomy refers to a society where the majority of the wealth is controlled by an ever-shrinking minority; as such, the economic growth of that society becomes dependent on the fortunes of that same wealthy minority.

INVESTOPEDIA EXPLAINS 'Plutonomy'

This buzz word was initially coined by analysts at Citigroup in 2005 to describe the incredible growth of the U.S. economy during that period despite increasing interest rates, commodity prices and an inflated national debt. Citigroup analysts argued that as such an economy continues to grow in the face of contradictory elements, the more important the society's ultra rich become to maintaining such growth. The analysts also believed that in addition to the U.S., Canada, Great Britain and China are also becoming plutonomies.

RELATED TERMS
  1. Plutocracy

    A government controlled exclusively by the wealthy either directly ...
  2. Uneconomic Growth

    When economic growth produces negative external consequences ...
  3. Boom

    A period of time during which sales of a product or business ...
  4. Expansion

    The phase of the business cycle when the economy moves from a ...
  5. Economic Growth

    An increase in the capacity of an economy to produce goods and ...
  6. Macroeconomics

    The field of economics that studies the behavior of the aggregate ...
Related Articles
  1. The History Of Economic Thought
    Economics

    The History Of Economic Thought

  2. Are We Losing The Middle Class?
    Personal Finance

    Are We Losing The Middle Class?

  3. The Financial Markets: When Fear And ...
    Active Trading

    The Financial Markets: When Fear And ...

  4. What Is An Emerging Market Economy?
    Economics

    What Is An Emerging Market Economy?

comments powered by Disqus
Hot Definitions
  1. 80-10-10 Mortgage

    A mortgage transaction in which a first and second mortgage are simultaneously originated. The first position lien has an ...
  2. Passive ETF

    One of two types of exchange-traded funds (ETFs) available for investors. Passive ETFs are index funds that track a specific ...
  3. Walras' Law

    An economics law that suggests that the existence of excess supply in one market must be matched by excess demand in another ...
  4. Market Segmentation

    A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will ...
  5. Effective Annual Interest Rate

    An investment's annual rate of interest when compounding occurs more often than once a year. Calculated as the following: ...
  6. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
Trading Center