Question

In recent decades, economic inequality (both income inequality and wealth inequality) has become a prominent topic in American politics. How would you define income inequality? How is income inequality measured? What has happened to income inequality in the United States since the end of the Second World War in 1945? What evidence can you provide to support your answer? What are the reasons for the changes in income inequality since 1945.

What is wealth inequality and how does it differ from income inequality? Is wealth more or less equally distributed than income? Why do you suppose that is? What has happened to wealth inequality in the U.S. in recent years? What accounts for those changes?

Do you think the trend in economic inequality is a problem? Why or why not?

Answer 1

In recent decade, one new topic of economic inequality is in headline in America . Income inequality is defined as huge difference in income earned by the rich and poor people. Rich people have more income in their hands as compared to the poor people. Income includes wages, rent and investment earnings. According to data by Census bureau 5% of household receive 21.7 % of income and while 60% people receive 27.8% of income.

In America income inequality is measured by the US Census bureau by making use of household income. At the same time income inequality is measured by Gini Index. Gini index ranges between 0 and 1 . If Gini Index is zero there is no income inequality and if it is 1 then there is income inequality.

There is rapid increase in income inequality in America since the Second World War. Rapid increase in income inequality is after the 1970. Technology, trade and education are responsible to have increase in income inequality. Technology is advanced in America therefore who involve in technological work get high income than the laboures. Stagnation is also responsible to increase income inequality in America. Moreover , less participation by workers , recession and unemployment is also responsible for income inequality.

Wealth inequality implies the difference in the personal wealth between the rich and poor citizens. Wealth inequality is harsh than the income inequality because wealth inequality includes stock of crucial belongings while income inequality include only income.

There is increase in the wealth inequality in America. Census Bureau reveals that from the time period of 1983, there is increase in wealth with the rich people. Wealth increased from 60 %to 78%. At the same time there is decrease in wealth with the poor people . Wealth decreased from 32 %to 17%. Rapid increase in wealth inequality is after the 1970. Technology, trade and education are responsible to have increase in wealth inequality. Technology is advanced in America therefore who involve in technological work get high income than the laboures. Stagnation is also responsible to increase wealth inequality in America. Moreover , less participation by workers , recession and unemployment is also responsible for wealth inequality.

I think income inequality is a problem because it decrease productivity of poor people and nation growth stops.