Question

List three policies that can affect the level of economic inequality.

Answer 1

In the set of development instruments of a country, the economic inequality is always kept on the top of everything. The essence of inequality is realised specially in the developed and developing countries. Now we will list three policies that can affect the economic inequality.

The following are the policies.

1. Redistribution of Income: One of the major influencer of economic imequality can be redistribution of income. Income should be distributed amongst the lower income people from the higher income people. The government should take string initiatives to support the poorer section of the economy. Sme welfare programs such as, TANF, SNAP are aiming on redistribution and these programs are required to be funded sufficiently to to reduce the inequality of the economy.

2. Investment in Education: The early education and school quality should be equally maintained in the socity. If the quality of education is proper in an individual family, then this will help fighting the prevailing inequality accross generations. Hence, investmebts in education, initiating childhood programs such as Head Start, Universal Pre-K etc will help to grow quality of students and will also contribute to future productivity and decrease inequality.

3. Upliftment of Minimum Wage: Minimum wage does not affect the employment and also it does not retard the economic growth. But here the fact is, increase in minimum wage can lift up about 4.6 million people out of poverty. By increasing the minimum wage, it is possible to reduce inequality without affecting the economic growth.

These are some major policies that can influnce the economic inequality.