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The spike in gas prices is worsening the K-shaped economy

Business Insider·Madison Hoff, Juliana Kaplan·26 days ago
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New research examined how gas spending has changed across income groups. Howard Schnapp/Newsday RM via Getty Images New research shows that there's a K-shape emerging in gas spending. Higher earners are fine with buying gas at higher prices, but lower earners are pulling back. People can try to control their spending by consolidating their trips and checking reward programs. Gas prices aren't just causing headaches at the pump — they're also worsening a growing economic divide . A new report from the Federal Reserve Bank of New York finds that spending on gas mirrors — and deepens — the chasm between America's higher and lower earners. While everyone is spending more money, those at the bottom of the income distribution are cutting their real consumption at a much deeper rate than higher earners, suggesting a decline in driving or getting creative with how they get around.…

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