Question

David Madland. Chapter 4: “Stable Consumer Demand.” In Hollowed Out: Why the Economy Doesn’t Work Without a Strong Middle Class. Berkely, CA: University of California Press.

Explain why the author thinks consumer demand of the middle class is so essential to the economy at large. Be sure to use quotes and a citation if using the authors’ words directly.

Answer 1

In any country there will be three classes of people they are lower class, middle class and higher class. This higher class people are rich people, lower class people are poor people who comes below poverty line and middle class people are those who comes in between these two categories.

In any country more than 60% and less than 80% of the population will come under middle class , 5% will come under high class and remaining will come under lower class. People who have high income will always try to use luxury goods which will be imported from other countries. Poor people will not have money just to consume for one single day.

Middle class people can make or break the economy of the country because these people are more in number and they consume goods that are produced in our country. These people are the working class category they work for money and again inject that money into the economy by consuming goods. Middle class people will save their money in the country and because of them only financial institutions in any country will be running. So without middle class there will be no economy of a country.