There's a Mind-Boggling Number of Rich People in America | Odd Lots

Watch on YouTube ↗  |  September 18, 2026 at 08:10  |  1:00:12  |  Bloomberg Odd Lots
Speakers
Owen Zidar — Professor of Economics, Princeton
Eric Zwick — Professor of Economics and Finance, Chicago Booth

Summary

Odd Lots speaks with economists Owen Zidar and Eric Zwick about their book The Everywhere Millionaire, which uses IRS data to study the private business owners behind a large share of US wealth and inequality. They explain how pass-through entities became dominant after the 1986 tax reforms and why protected local industries like auto dealers, beer distributors, dentists, and doctors generate huge owner profits. They also discuss private equity and search funds as buyers of founder-owned businesses amid the baby-boomer wealth transfer.

  • Authors used linked IRS data to identify millions of wealthy private business owners.
  • Pass-through entities now account for about half of business profits and a large share of top-end income.
  • Regulatory protections and local market power help explain wealth in auto dealerships and beer distribution.
  • Dentists and doctors appear among the most profitable pass-through service industries.
  • Private equity and search funds target founder-owned businesses with no succession plan.
  • The baby-boomer wealth transfer creates a large pipeline of business-sale opportunities.
  • Tax loopholes persist partly because many elected officials are pass-through owners.
  • Hosts summarize the book as a new lens on US inequality and wealth.
Ideas
Owen Zidar Professor of Economics, Princeton 16:25
Auto dealers have protected high-margin profit pools.
Auto dealerships are a top pass-through profit pool because state franchise laws protect dealers from manufacturer competition, create local geographic monopolies and barriers to entry, and let them capture high-margin ancillary services such as financing, warranty, and repair. This regulatory structure supports owner profitability.
Auto dealerships HIGH
Owen Zidar Professor of Economics, Princeton 23:12
Beer distributors have protected middle-tier economics.
Beer distributors are protected by state franchise rules and post-Prohibition three-tier systems that force brewers to sell through wholesalers. This middle tier limits competition and lets distributors capture a share of growing beer demand, making them extremely wealthy.
Beer distribution MED
Owen Zidar Professor of Economics, Princeton 32:25
Dental practice ownership is highly profitable.
Owning multiple dental practices can be very lucrative because dental services have high and recurring demand, practices are numerous and profitable, and dentists have lobbying power to protect against government price pressure such as Medicare dental coverage.
Dental practices MED
Owen Zidar Professor of Economics, Princeton 33:30
Doctors' offices benefit from scarce expertise.
Doctor's offices are the top pass-through industry by profit because demand for skilled medical services rises while the AMA and other supply restrictions limit the number of doctors, leaving scarce expertise able to capture a larger share of practice revenue and raise prices.
Doctor's offices MED
Eric Zwick Professor of Economics and Finance, Chicago Booth 41:27
Private equity targets founder-owned succession gap.
Private equity has a large opportunity buying founder-owned, unglamorous mid-market businesses where there is no family successor. These firms are often profitable with barriers to entry or established customer networks, and PE can pay up, consolidate, and grow them. The baby boomer wealth transfer puts more than half of tens of trillions of dollars in business wealth in play.
PSP HIGH
Eric Zwick Professor of Economics and Finance, Chicago Booth 43:38
Search funds offer asymmetric mini-LBO returns.
Search funds can do mini-LBOs of good founder-owned businesses that are too small for private equity. The strategy has negative median returns but low-20s average returns because successful deals provide large optionality, and there is a large pipeline from aging owners without successors.
Search funds MED
Eric Zwick Professor of Economics and Finance, Chicago Booth 44:53
California drug treatment facilities offer high returns.
Drug treatment facilities in California have seen huge demand growth, and running them well requires managing complex billing and regulation. That operational and regulatory complexity creates a barrier and has produced outsized returns, including a 100x investment in one search fund case.
California drug treatment facilities MED
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This Bloomberg Odd Lots video, published September 18, 2026, features Owen Zidar, Eric Zwick discussing Auto dealerships, Beer distribution, Dental practices, Doctor's offices, PSP, Search funds, California drug treatment facilities. 7 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Owen Zidar, Eric Zwick  · Tickers: Auto dealerships, Beer distribution, Dental practices, Doctor's offices, PSP, Search funds, California drug treatment facilities