Question

Discuss why there is such income inequality within the United States. What role does the American Dream play in the context of this financial reality?

Answer 1

The income inequality has increased in the United States over the past 30 years, asincome has flowed unequally to those at the very top of the income spectrum. Current economic literature largely points to three explanatory causes of falling wages and rising income inequality: technology, trade, and institutions.The most plausible explanation for income inequality's apparent effect on health and social problems is 'status anxiety'. This suggests that income inequality is harmful because it places people in a hierarchy that increases status competition and causes stress, which leads to poor health and other negative outcomes..To be clear, this finding implies that, on average, increases in the level of income inequality lead to lower transitional GDP per capita growth. Increases in the level of income inequality have a negative long-run effect on the level of GDP per capita. This is how the American dream would seem to die slowly as gender inequality of any form will never make it possible to build a world that is socially and economically empowered.