...Income Inequality In Chapter 20 of microeconomics one of the main points to this chapter is to understand income inequality and what causes income inequality. The three points I think they are very important to understand income inequality is the definition, and two examples of what causes income inequality. Education and training and discrimination are two examples that can give a more visual perspective of what income inequality is. The definition to income inequality according to the McConnell “Income Inequality is the distribution of an economy’s total income among households or families” McConnell (411) The concept of inequality is distinct from that of poverty and fairness. Income inequalities are used by to measure the distribution of income, and economic inequality among the participants in a particular economy, such as that of a specific country or of the world in general. According to the webpage businessdictionary.com “While different theories may try to explain how income inequality comes about, income inequality simply provide a system of measurement used to determine the dispersion of incomes.” In the text book from economics the author said “There are several causes of income inequality in the United States. In general, the market system is permissive of a high degree of income inequality because it rewards individuals based on the contributions that they make, or the resources that they own, in producing society’s output” McConnell (414) One of the main factors...
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...portion of the population is forced to hold the base of our country in place while hardly being redeemed for their time and effort, and thus the problem of income inequality. Numbers of these people live from paycheck to paycheck, barely getting by, not because they manage their money poorly, but because the value of their time at work is negligible (Chapter 2 Economic Inequality). Some may even sacrifice happiness at work to find a job that pays better simply because they cannot make ends meet at their current job. Some people sacrifice their sanity and eventually their life just to keep from going under financially. Segregation in income distribution is another cause of these problems, such as that with women or African-Americans who make less than other classes comparatively. In contrast, actors and actresses such as Brad Pitt and Julia Roberts make millions in the entertainment industry, an industry that grosses hundreds of millions of dollars a year creating what adds up to be the same kind of entertainment most people could get out of watching their children play sports or sing in a choir. The question then is how to find the value of work and time in our society and what should determine income. Positive reasons for income inequality are hard to find. One reason is the incentives there are to achieving higher status of income. You are regarded as successful in the eyes of your peers, and if you’re financial security is achieved, your life can be a lot less stressful. It is the...
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...the American dream of upward mobility is hindered by our economy’s disproportionate income distribution. Based on statistical evidence and facts from the arguments, it is clear that income inequality does, in fact, impair the American dream of upward mobility. Analysis According to a census performed in 2015 by the U.S. Census Bureau, America has experienced economic growth in regards to national income. Though this sounds like a factor that would...
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...Income inequality Name Date Abstract In any given population, there is a difference between what people within the population earn. The uneven distribution of income in any given population is income inequality. In order for there to be income, there has to be several sources of income. These sources of income may be combinational or independent per person receiving the income. Income may result from wages, rent, bank account interests, salaries or even profits made in business transactions ( Stiglitz, 2012). In his hypothesis, Karl Marx foresaw income inequality in a capitalistic as a major problem that would lead to an economic evolution. The main reason he foresaw an evolution was due to the recurrent nature of income inequality. In an income inequality situation, the richer keep getting richer due to a better income, while the poor keep getting poorer. The gap between the top earners and the low-income earners keeps widening in an income inequality situation. In America, almost 95% of the national wealth is under 5% ownership; this situation leaves 95% of the population to scrounge for the limited 5% wealth (DeNavas et. Al, 2005). Introduction In order to understand the complexities of economic inequality, the best specimen to use for the study is a family. In the study, the family’s income is under analysis, and then the family members ranked from the lowest income earner to the highest income earner. After the ranking, the incomes aid in establishing a Lorenz...
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...is a problem is that the wider gap often lead to greater inequality among people, yet society has not found a way to solve this inequality (Treanor, Oct 13, 2015). To make it easier to demonstrate how income difference results in social inequality, CEOs, for example, who gives workers minimum compensation, work in top floor of high rise office buildings where they can overlook an entire city, whereas some people work more than 40...
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...Income inequality has been a major problem in the United States for several decades and it seems that there is still no cure for the problem. In fact, income disparities has become so pronounced that America’s top 10% now average almost 9 times the bottom 90% of the population. Furthermore, almost all of the current presidential campaigns from candidates both from the democratic and republican parties addressed this very problem. But the question is why is it bad? Everyone knows that income inequality is bad for the economy because it hampers the growth. But again, how does it hinder economic growth? The first reason is that because income inequality restricts access to education. Children from high-income families, which amounts to only a small amount of the whole population, tends to have higher test-scores and higher chance to attend college than children from low-income families. Income availability significantly determines the opportunity of education and thus social mobility. This then results in the suppression of job creation. This then lowers the whole economic growth of the country and perpetuates the income inequality that has grassroots in the society. One way to cure this problem is to make it easier for people to start and join unions. Unions can bargain wages for lower and middle-income classes so it reduces inequality. A second way to reduce inequality is by relaxing licensing rules. This would make it easier for low-income people to enter well-paid professions...
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...Cammie Denton Dr. Foster WR 122 April 17, 2016 Rhetorical Analysis of Barack Obama’s Remarks on Economic Mobility On December 4th, 2013 Barack Obama spoke on the subject of income inequality and upward mobility. This speech was delivered to, and hosted by, the Center for American Progress (CAP). The president uses striking language to appeal to the emotion and logic of the audience. Obama executes his appeals in a variety of ways with the express purpose of painting the issue of growing inequality and decreased upward mobility as the “defining challenge of our time.” President Obama describes these issues as what drives everything he does as POTUS. Obama’s speech was quite intellectual and technical, peppered in detail with the numbers and statistics of current social and economic inequalities, appealing to logos. While he builds his argument based on these substantial facts, the overall feeling of his language is that of compassion. This compassion seems to drive his purpose and thus emotionally connecting to his audience. Further, Obama appeals to ethos during his speech as he outlines how current market-caused inequalities are threatening everything that makes America great. Obama masterfully balances his passionate language with solid facts and straight-forward logic in this effectively persuasive speech. Before expanding upon the specifics of the rhetorical methods utilized by the president in this speech, I think it is important to highlight that the audience (CAP)...
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...1. a) Discuss the effects of income inequality on a nation’s economic conditions. Income inequality is the unequal distribution of income among individuals of an economy (Income Inequality, 2014). In other words, the difference between the wealthy individual’s income and middle-class to poverty-stricken individuals’ incomes continues to increase. Such disparity can have detrimental effects on the economy. Those individuals who have a low-income are less able to purchase goods. As income inequality between individuals increases, money moves from those who used it to purchase their basic needs to those who already had enough and more. This then causes a weakened aggregate demand for products because the middle-class and poor can no longer afford...
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...As a graduate student, I studied Economics, and I have always been very interested to learn more about the correlation between economic growth, income distribution and a flourishing society. In his paper on Economic Growth and Income Inequality, Gallo (2002) refers to the theory of the famous Political Economist Adam Smith who states that "no society can be flourishing and happy, of which the far greater part of the members are poor and miserable." (Gallo, 2002). He further explains that whenever there is a high inequality in income distribution, there is a decline in economic prosperity. This implies that countries should strive towards bringing equality of income among their population to ensure economic growth and the welfare of their nation. Income inequality however, is a fact of life and exists all over the world....
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...Student’s name Subject Title Lecturer’s Name Date of submission Income Inequality Introduction The problem of an increase in household income inequality has been a major talk point in political discussion and public policy. According to Winston Churchill, inequality is unavoidable especially in capitalist societies. However, President Barrack Obama views inequality as not only a major problem but as a defining problem of this generation. It cannot be disputed that income inequality in the United States has been rising over the past four decades. The trend is evident when income is measured both before and after taxes. The income inequality in the U.S today can be compared to those of other developed countries. However, the country ranks amongst the worst in inequality especially after taxes and transfers. This means that less income that is received from higher income households trickles down to lower income earners. A recent study in 2011 revealed that the top earners income increased by around 275% after income transfers and federal taxes. Today, there is ongoing debate as to the effects, causes and solutions of the income inequality. Over the years, debates have arisen whether the income inequality gap in America is a social or an ethical problem. Despite businesses breaking profit records, these income gains have been concentrated on the top 1% (Glenn 58). It is often argued that income inequality is a social injustice and that it is unfair. However, social injustice...
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...Income inequality in Turkey and its causes and effects on the Turkish population Maastricht University | | | | School of Business & Economics | | | | Place & date: | Maastricht,08 December 2014 | Name, initials: | Canli, T | ID number: | 6091093 | Study: | International Business | Course code: | ebc1009 | Group number: | 1 | Tutor name: | Pierfrancesco, Guarino | Writing tutor name: | Campbell, Gabriel | Writing assignment: | Main Paper (Task 10) | | | t.canli@maastrichtuniversity.nl Table of Contents 1. Introduction 2 2. Income Inequality and its components 2 3. Gini coefficient and inequality 3 4. Turkey´s economic structure 3 5. Wage distribution in Turkey 4 6. Main causes of inequality 5 6.1 Return on capital and increase of economic input 5 6.2 Relationships between people and social mobility 5 7. Effects on Turkish population 6 7.1 Education, child labor and social mobility 6 8. Possible solutions 7 9. Conclusion 8 10. Works Cited 9 11. Figures 10 12. Tables 10 1. Introduction In the past decades the topic “Economic Inequality” has risen in popularity. The reason for this trend is mostly because economic inequality has risen drastically around the world. There are many forms of economic inequality, e.g. gender inequality, regional disparities, and wage inequality, only to name a few. Thus many politicians are discussing about economic inequality, particularly in Turkey. The largest driving...
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...Income inequality is one of the big issues in 21st century. Unequal distribution of income in society is considered to be an obstacle to economic growth. The income allocation of a country’s population can be measured by a Gini coefficient. The value of Gini coefficient can be between 0 and 1 and used to define the income gap between the rich and the poor. The value 0 shows perfect equality and value 1 illustrates perfect inequality. The US can be an example of country with high income inequality. The US Gini coefficient has risen by 20% between 1979 and 2010 (Frizell, 2014). Factors like family structure (i.e. how many earners are there in family), technology (i.e. changes the way that we live), and immigration (i.e. changes the supply of...
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...The Issue of Income Equality in the US By SOC 100: Intro to Sociology April 29, 2012 A major social problem in America today is its inequality of the distribution of income. "Income inequality refers to the gap between the rich and the poor. The United States has the most unequal income distribution in the industrialized world, and it is growing at a faster rate than any other industrialized country" Bernard Sanders (1997). What's really going on with the economy? - Unequal distribution of wealth and income. [ONLINE] Available at: www.usatoday.com. [Last Accessed 04/27/2012]. Society defines this social issue as the disparity between the few at the very top of the income ladder, and the many at the bottom. Recently, the Occupy Movement has defined this problem has fight between the 1% and the 99%. The social classes that are most impacted by this disparity pretty much cover the spectrum as we are all affected. The most latent effects are probably found in the poor, in single-mothers, and in the minority classes. Those are the classes that have the least amount of economic and social power at the onset. A persons clothing, housing and educational opportunities usually depend on their class, but that is a direct reflection of their income. A person does not gain any class or power without their income being taken into consideration. The only problem is, is that there is also class inequality, which further prohibits people to earn an equal...
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...2010). In 2008, inequality again rose (to a Gini coefficient of 0.52), as did poverty (World Bank, undated [c]). A 2008 report indicates not only that Mexico ranked last in income equality among all OECD countries but also that Mexico's inequality is strictly greater than that for all OECD countries across all deciles in the income distribution. That is, Mexico's income distribution from top to bottom is worse than that of any other OECD country" (Aguila, 2012, p.104-05). Figure 10.2 displays the share of the population with different levels of education and the income share of those education groups in 1994 and 2002. "A positive trend in educational achievement is suggested by this figure because the percentage of individuals in the two...
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...Dramatic stories exposing a widening inequality of income and a disappearing middle class in America have permeated the media in recent years. These stories have been based, almost universally, on biased analyses which manipulate and misrepresent the underlying economic facts. Issue one income inequality has its own reasons, though it seems as if the government holds the people to its standard of income. This is data generated by the “Census Bureau, the Bureau of Labor Statistics” and other sources invalidate claims commonly made by people. For example, data from such agencies show that: Differences in family income largely reflect differences in how many members of a family actually work -- and how hard they work. Other data also explains the widely distributed of income today as at any...
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