In a 'K-shaped' economy, higher earners' spending rises while lower earners' spending stagnates or decreases.

How life looks different with a $75K household income versus $150K

"The cleanest way to describe the gap is that $75K is often about stability, while $150K can be about optionality, but only if fixed expenses do not expand to consume the raise," said one finance professor.

A V-shaped recovery from a recession is the most common kind

When charted, recession recoveries resemble letters including V, U, W, L, and K. For instance, an L-shaped recovery involves a steep decline that slowly reverses.

See a chart that shows how the average American spends their annual earnings, with almost half of all American consumer spending going toward transportation and housing.

Even high earners are living paycheck to paycheck

While roughly 14% of American households make $200K or more per year, many of them still don't feel rich. For instance, more than 60% of people with salaries over $300K per year still struggle with credit card debt.

A recession is commonly defined as two consecutive quarters of shrinking GDP, but in practice, these economic phenomena are more complex.

In the wake of the Great Depression, a Russian-American economist named Simon Kuznets popularized the formula for gross domestic product to summarize the health of the economy and provide the American government with a metric to track growth.

Find out what salary makes each generation 'upper class' today

For instance, as of 2026, Gen Zers are considered upper class in lower-cost-of-living areas when they start making around $110K per year. In areas with a higher cost of living, they're considered upper class once they make $130K to $150K or more per year.

Juliet Schor wrote an informative book about the gig economy: 'After the Gig'

In an interview, she explains that gig economy workers come in two groups: people who are earning supplemental income on the side of a full-time job, and people who depend on gig work for their entire incomes. As it turns out, those groups feel very differently about the gig economy.

See comparisons of different countries' taxation strategies

Taxes are a major revenue source for most countries, and how each government taxes citizens often reflects the country's economy. Developed countries tax at much higher rates than developing ones, and as a country grows its GDP, it also typically grows the proportional percentage of taxes it gains from its citizens.

Watch Ray Dalio explain how the economy works

Dalio describes the economy as a machine that runs on three main cycles: productivity growth, the short-term debt cycle, and the long-term debt cycle. Dalio says layering these three cycles on top of each other essentially creates a template for understanding changes in the economy.

At $159K, Luxembourg has the world's highest GDP per capita (also known as GDP per person) as of June 2026.

Ranking the world’s economies: 1980 vs. 2025

The US remains the world’s largest economy, having increased its annual gross domestic product from $2.9T in 1980 to $30.6T in 2025. In 1980, China ranked seventh globally with a GDP of $304B. In 2025, China ranked second with a GDP of $19.4T.

COVID-19's shock to employment rates sparked some economists to fear deflation

COVID-19 simultaneously disrupted the supply chain and the labor market. Since the unemployment rate had hit record highs, some economists were worried that the supply chain would recover before the labor market. If that had happened, businesses would have been producing goods, but no one would have been able to buy them because they wouldn't have the disposable income to do so.

Massachusetts is the state with the highest median household income for young Americans at $123.2K per year

Americans ages 25 through 44 make more in some states than others. While Massachusetts took the top billing, Mississippi came in last place out of all 50 states at $66K per year—a roughly 87% difference. However, it's important to remember that the cost of living in many of the highest-earning states in the US is significantly higher than the cost of living in the lowest-earning states.

Inside the lives of HENRYs

The acronym "HENRY" stands for "high earner, not rich yet." The phrase is becoming more popular as new census data shows that roughly 14% of US households bring in $200K or more per year. This article dives into the lives of a few HENRYs and explains the factors keeping them from increasing their respective net worths, from child care costs to rising housing prices. Read it here.

The household income considered 'middle class' has increased significantly in the past 10 years

However, the increase has been larger in some states than others. In Texas, for instance, 2023's middle-class annual incomes ranged from $50,861 to $152,584, whereas 2013 middle-class annual incomes ranged from $34.6K to $103.8K.

The clearest sign of a recession is a steady increase in job losses and high unemployment.

The number of people collecting money from gig work tripled between 2017 and 2021

That includes people driving for Lyft or delivering food through GrubHub. Those people might be changing the face of the US economy at large, too. Gig work provides a cushion between jobs outside of government unemployment assistance, for example.

When consumers think an economic downturn is looming, the 'lipstick index' economic theory argues that sales of more affordable luxury items (such as lipstick) go up.

Since 1913, Americans have paid income taxes at varying rates

In the 2020s, the top marginal tax rate has floated around 37%, relatively lower than previous eras. Some have called for boosting the rate significantly to tax the highest earners.

In 1980, the median US household income was $21,020

In 1980, a steady middle-class job paid roughly $13,000 to $16,000 a year, according to Bureau of Labor Statistics data. That income comfortably supported a household on one paycheck. The average full-time worker today, who makes $68K per year often cannot afford to support a household without a second income.

In 2025, the US credit rating was downgraded over concerns about the debt-to-GDP ratio.

25% of US households had no regular income as of 2024

Some states had higher shares of no-income households than others: West Virginia, for instance, had a national high of 34% of households with no income. These states tend to have older populations, higher rates of disability, and lower median incomes overall. In such contexts, a larger portion of households rely on non-earned income sources or report no income during the survey period.

Consumer spending accounts for 70% of America's gross domestic product.

The income needed to be middle class in every US state

Depending on the US state you live in, the household income needed to be considered "middle class" can vary from only $36K per year to $200K per year. It's more expensive to be considered middle class in states like Massachusetts and New Jersey than it is in West Virginia or Mississippi. See these numbers in a data visualization here.

The Bretton Woods economic order was built on Keynesian principles

Keynesian economics suggests that governments should actively manage economies to prevent downturns, promote employment, and regulate markets. The Bretton Woods institutions were created based on this belief that coordinated public intervention could prevent the economic crises of the 1930s.

Explore an interactive chart that shows peoples' annual salaries by occupation

The median salary for full-time workers in the United States was roughly $49.5K in 2024. An interactive chart details how salaries differ by occupation.

Each generation’s median income

Discover data about each generation’s income in the US. Generation X currently holds the title of highest earners, with notable wealth for those living in Maryland. Find out which groups tend to succeed and why, while seeing where you stand in comparison.

US state economies compared to entire countries

This map compares US state economies by their gross domestic product to that of a similarly sized country. For instance, California has the largest state economy in the US, with a GDP nearly equal to that of India, the fifth-largest economy in the world. Click here to see how the rest of the states compare.

Watch this video to learn how US tax brackets actually work.

What something costs is reflective of a balance in the market determined by the amount of demand relative to the supply of goods and services

Because economies are complex systems, a wide variety of issues influence this balance—including some things generally considered to be positive, like rising wages.

In 2023, the US money supply fell at its fastest rate since the 1930s

The money supply tracks how much cash, as well as electronic funds like savings accounts, is circulating through the economy. And a downward turn can be a bad sign.

John Maynard Keynes was one of the most influential economists of the 20th century

Keynes influenced economic thought by arguing that governments should spend to stabilize economies during downturns. His ideas shaped the postwar international order and remain central to modern economic policy debates.

The psychological aspect of deflation makes it difficult for policymakers to stabilize the economy

That psychological aspect is referred to as "the deflationary spiral." When prices start decreasing, people tend to hold on to their money to pay the lowest prices. But as prices start stabilizing, people resist increasing prices. (Some users may experience a paywall.)

AI investment may be the next major economic bubble

A video examines the massive surge in AI spending—forecast to hit $500B by 2026—and how this may be propping up a fragile US economy. Experts warn that if AI investment slows or under-delivers, the consequences could be felt in markets, jobs and growth.

A centrally planned economy is one where the government—not markets—sets production

This Investopedia article explains how command economies work, which countries have used them, and why even market-based nations like the US sometimes adopt tools such as rationing or price controls during wartime or national emergencies.