Question

2. Would you expect greater income inequality in country A, where there is a large disparity in age, or in country B, where there is a small disparity in age? Explain your answer.

Answer 1

Answer- Greater income inequality would exist in a country with high age gap than in a country with a low age gap. Since in every professions a person needs experience to work well and a person can gain experience and knowledge only by working for more number of years. Also, if a person is more skill full then he or she would be contributing more to the organisation or the the company in which he or she works, thus, such a person with high experience and knowledge will get a higher pay than a person who is a fresher.

The gap of knowledge between the fresher and an experienced person will create a gap in the pay between the two type of persons. Since a person will high experience will contribute more to the company and help the company in it’s growth. A company would pay more to person who are considered as assets for the company and contribute more to it’s growth.

According to the above explained information, it is clear that country A with large age disparity will have more income inequality.