The poor often spend more on all kinds of things. Households that have less money to spare in any given week, for example, are forced to buy toilet paper and similar goods in small packages, increasing the prices they pay. In addition, poor families must rely on a whole range of alternative financial services, which might charge exorbitant fees and expose customers to serious risks.
New research suggests that these disparities might only be getting worse. Xavier Jaravel, a graduate student at Harvard University, has been studying the prices people pay in the retail sector — their everyday purchases at grocery and drug stores. He has found that prices are increasing by more than 2 percent a year on average for goods purchased by consumers with household incomes under $30,000, but by just 1.4 percent annually for those with incomes above $100,000.
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