*Note to the reader:
please credit the author when using the following equations, graphs, and tables
since this is original material. *

**A NEW DEFINITION OF CAPITALISM**:
Capitalism is a monetary system which distributes wealth by a **definable distribution** raised to a power
of a base as determined by rank, where the percentage of those with average
wealth and above approximately equals the percentage of those with no wealth
and debt. Given constant average wealth and median wealth, both values become
trivial compared to the wealth of the very richest as the number of entities in
the economy increases. **Capitalism
creates huge levels of wealth inequality by intrinsic exponentiation as determined
by rank.**

If poverty is considered lack of wealth, then poverty must
be intrinsic to capitalism based on empirical evidence from the Survey of
Consumer Finances from 1983 to 2007 as compiled and adjusted by Edward N. Wolff
in *Recent Trends in Household Wealth in
the United States: Rising Debt and the Middle-Class Squeeze---an Update to 2007. *

Above is a graph of a hypothetical wealth distribution of an economy of one million households with an average wealth of $369,385 and median wealth of $76,093 using the First General Wealth Equation. The numbers directly above the gray indicators are the actual averaged numbers from the Wolff data from 1983 to 2007. The gray indicators show the computer calculated percentages.

Since the wealth distribution was apparently so skewed, I worked with the natural log of wealth while trying known distributions to describe the data. There were relatively few data points so it was quite a task to either find or create a distribution to fit the data. Eventually I realized the best fit (among commonly used distributions) would be back to back tails of normal distributions as shown in the Natural log of Wealth graph as pictured below:

*Entire distribution
above is raised as a power to base e to yield the Predicted Wealth
Distribution *

In order to create a general wealth equation, I believed the
equation needed to be scalable in both the wealth and population axes. I found
the trick to doing this is taking the famous "Bell Curve" Normal Distribution
Probability Distribution Function and modifying it where frequency (people) and
probability (wealth) switch axes, where only positive values of wealth are
allowed, and where the mean and standard deviation become zero and one
respectively to create my ** First** **General
Wealth Equation:**

*Wi* is an individual's wealth, *Ri* is the individual's rank either above or below the top 20% in equal decrements in descending order, and *A* and *M* are an offset and multiplier respectively.

To evaluate from the top 20% to the wealthiest, use the equation in this form:

To evaluate from the top 20% to the bottom 17.6375%, use the equation in this form:

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