...Name Professor Course Date Inequality in China Over the past few years, China’s economy has been booming and, therefore, lifting millions of its citizens above the poverty line. Consequently, China’s GDP has increased, implying widening of the gap between the rich and the poor. According to Aljazeera, in 2010 China recorded a very high Gini coefficient of 0.61 (Duggan, “Income inequality on the rise in China”) The Gini coefficient shows income distribution in a country, and hence inequality levels. This means that the inequality in China is very high as the Gini coefficient of one represents total inequality while zero Gini coefficients represents perfect equality. In large cities such as Shanghai, inequality is evidenced by the presence of extremely rich citizens and beggars with plastic cups sitting on the streets. The Chinese government needs to implement a taxation policy that accommodates all its citizens from the richest to the poorest. The problem of Income inequality can be solved by reducing the tax rates for low wage earners and increasing the rates for high income earners (Xiang, “Narrowing Gap between Rich and Poor”). There has been a close correlation between human rights and productivity. Many economic analysts argue that when China was poor there was relative equality in the country. While this argument may be true, human rights depend on the economic structure and cultural structure that surround the people. Economic structure defines the behavioral freedom...
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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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...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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...Medium Human Development economy HDI < 0.500: Low Human Development economy For a country with HDI of 0.47, the interpretation would be that this country has, on average, attained 47 percent of what is possible and can be classified as low human development economy. This country therefore has a shortfall of 53 percent from the maximum value on the HDI components of life expectancy, school enrolments, adult literacy, and PPP GDP per capita. Gini index Gini index measures the extent to which the distribution of income among individuals or households within an economy deviates from a perfectly equal distribution. The Gini index can vary between 0 and 1 or can be expressed as a percentage. Gini index of 0 means that the extent to which the distribution of income among individuals or households within an economy deviates from a perfectly equal distribution is 0 percent implying that there is perfect equality (or everybody has the same income) and Gini index of 1 means the extent to which the distribution of income among individuals or households within an economy deviates from a perfectly equal distribution is 100 percent implying that there is perfect inequality (one person has all the income in the society). Generally, Gini index in their low 20s show low inequality or greater income equality, those in their 30s and 40s show medium levels of inequality, those in their 50s show high levels of inequality, and...
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...Democracy, Religion and Inequality University of Groningen Faculty of Economics and Business Bachelor Thesis International Economics and Business Name Student: Yitian Jing Student ID Number: s2012790 Student email: y.jing@student.rug.nl Date Thesis: Jun. 5th, 2012 Name Supervisor: Dr. Robbert K. J. Maseland First and foremost, I would like to express my sincere appreciation and gratitude to my advisor, Dr. R. K. J. Maseland, for his academic guidance and encouragement throughout the research. He has been very generous sharing his experiences on institutional and cultural determinants on economy, as well as on academic research methodology and beyond. I would not have finished such a thesis paper without his support. His effort and patience would never be forgotten. Abstract The democracy’s inequality decreasing effect has been appealing to researchers for long but lacks concentrated argumentation and empirical evidence, as well as the interaction between democracy and religion. This paper conduct an empirical analysis covering time period of 1978-2010 with 86 countries to test the hypotheses of whether democracy decreases inequality and whether an egalitarian religion decreases the influence of democracy. The result shows the direct effect of democracy is weak, however, the hypothesis of religion’s effect on the democracy’s influence is partially confirmed. Therefore, democracy itself has minor influence on inequality while a large proportion of the effect is...
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...● 01. 6 generalizations about institutions 1. People use institutions to serve specific ends. 2. They divide labor .3. Institutions save everyone's time and energy; in technical language, they reduce transaction costs. 4. Institutions exist independently of the particular people participating in them. 5. Institutions distribute authority. More power inheres in some roles than in others. 6. Participants will attempt to adapt it to their own purposes; but they are difficult to change. ● 02.How do institutions check tyranny? - checks and balances:Social pluralism, we divide government up between three institutions with all the same amount of power, ● 03.Why are institutions difficult to change? Path dependency: reliance on experience, constrained by status quo; solutions based on familiar institutions. Some participants are content with current arrangements and not willing to change. ● 04.Framers consciously designed a set of institutions for making it possible to do politics of this kind. The point is to design a set of institutions that control the effects of factions--by setting them against one another, but dividing authority among institutions ● Problems with the Articles of confederation No ability to tax , No central currency, No way to negotiate treaties ,No executive capacity, difficult to maintain public order, nation security. ● 06.Deals addressed by the constitution Path dependency: reliance on experience, constrained by status quo; solutions based on familiar...
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...Discussion Question: How do you accurately account for economic inequality in order to better assess living standards across and within countries? Discuss the factors affecting economic inequality and the implications on a local and global scale. Before even getting into the debate of assessing living standards, inequality and its measurement, let us first define income and consumption and how these measures are used to assess living standards in mainstream economics. According to Folbre, income encompasses all resource inflows to the household while resource outflows make up for the consumption variable (Folbre, 2009). In today’s world, living standards are assessed by looking at either of the two measures; however, most people agree that looking at living standards from the consumption angle gives us a better, more accurate feel for disparities. That being said, we recognize that these two measures do not provide a full picture: we look at resource inflows and outflows to and from households; however, we do not take into account what actually happens within the household. In recent years, more and more economists have shifted their attention to those non-market factors that directly impact standard of living among the population. In the following paragraphs, we will first examine how economic inequality is currently measured and the limitations underlying those methods. We will then elaborate on the additional parameters (household production and leisure) and their importance...
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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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...Should Income Inequality be Considered as a Serious Problem that Affects the Health of Most Individuals? Peng Peng AEIS111 Instructor: Roger Frost August 5,2015 With the rapid development of society, people did not have to worry about rising of income and income’s effects. Poor communities tend to suffer different diseases compared to rich people. The rich people will be associated with obesity while the poor are associated with wide range of diseases such as malnutrition, cholera, waterborne diseases and others (Rowlingson, 2011). In the recent years, all this seems different, and the apprehension has majorly shifted. Considering all this truly income inequality does affect the health of most individuals. Income inequality affects life expectancy, disease prevalence and social problems. On contrary, it is argued out that income inequality the main causative agent for health problems (Richard, 2015). This paper is an argumentative essay on how income inequality affects individual health and also identifies if it is the main causative agent or health problems. Firstly, there have been various studies that determine if indeed inequality affects the health of individuals. Those studies such as Whitehall studies have been able to demonstrate a link that is clear between the economic background and the health of individuals.It found out that people living in areas that are poor will die seven years earlier than the people that are living in areas that are...
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...Although Latin America has faced many social, political, and economic issues within the last three centuries, inequality remains one of the most important, historical, and omnipresent aspects of the region’s culture. As Europeans took over Latin America during the time of colonization, they implemented many elitist social structures that have held strong and are evident today (Harris). Income inequality is the most visible and greatest disparity that the region faces; yet inequality between gender, ethnicities, and education remain strong and significant problems with a necessity for improvement. Inequality of wealth and disparity of power and influence are Latin American’s greatest curses and are at the root of many of the developmental, social, criminal, and political problems that continue to plague the region (De Ferranti). Since inequality has pervaded into every feature of Latin American society, it is important to measure inequality accurately in order to obstruct the causes of the discrimination and prevent new ones from beginning. The Gini Coefficient is an effective way that people indicate the inequality of a country by measuring a frequency distribution of income or wealth. Using the "Gini Index" of inequality in the distribution of income and consumption, the researchers found that Latin America and the Caribbean, from the 1970s through the 1990s, measured nearly 10 points more unequal than Asia, 17.5 points more unequal than the 30 countries in the Organization...
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...3.2 Theoretical development The theoretical view in economic inequality has a long history. The deliberation of fair distribution can be old-fashioned to classical economist David Recardio and leftist theoretical matters as Karl Marx. These theorists have already documented the magnitude of distribution in the society, and among different classes of the people. 3.2.1 Kuznets Hypothesis: A reasonably moderate theory which has prevailed in the mainstream academia for about half a century is attributed to Kuznets (1955), which argues that income inequality would change as economic growth changes or more precisely, income inequality would rise first and then decline with economic growth. This theory is related with factor movement between sectors where there is inequality, which permits income distribution does not need to be fully equalized. This theory implies that fairer distribution may lead to higher productivity.[1] Kuznets curve is the graphical representation of Simon Kuznets's theory ('Kuznets hypothesis') that economic inequality increases over time while a country is developing, then after a critical average income is attained, begins to decrease. Figure 3.1: Graphical representation of Kuznets curve One theory as to why this happens, in early stages of development, when investment in physical capital is the main mechanism of economic growth, inequality encourages growth by allocating resources towards those who save...
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...Urban-rural Rising Income Inequality in China As a developing country, China is trying to develop its economy and solving the threat of poverty since the economic reform. As a well-known economist Arthur Lewis said that "development must be inegalitarian because it does not start in every part of the economy at the same time" in 1954 (Lewis, 1954). It is also true for China. The income inequality issue between poor and rich increased faster, which has a negative impact as China tries to become a more stable society. The gap between rich and poor is caused by complex factors. This paper is intended to discover and explain the issue of income inequality through urban-rural gap, and also give some suggestions according to today’s situation. Historical Analysis In pre-reform, China is very poor and has about 90% rural population (Knight et al., 2004). At that time, Gini coefficient measure income distribution is 0.280 (0 means perfect equality, and 1 means extreme inequality) (Naughton, 2007, p.217), which shows that Chinese people has almost equal income across the whole republic. Although it is good to show China is “one of the most equal countries in the world”(Naughton, 2007, p.217), the truth is that everyone is equally poor at the same time. In order to decline poverty and connect the new republic to the world, the Chinese leader Deng Xiaoping institute market reform and said “let some people get rich first”(The economist, 2001). Since then, China has maintained rapid growth...
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...Issues in inequality in non-income dimensions Achin Chakraborty Institute of Development Studies Kolkata 1, Reformatory Street, 5th Floor Calcutta University Alipore Campus Kolkata 700 027 India achinchak@rediffmail.com Abstract There are two basic approaches to measuring inequality in non-income dimensions. One views inequality as variation of an outcome indicator across individuals and the other views inequality as essentially disparities across socioeconomic groups. While the latter view now dominates the inequality measurement in health, measurement of education inequalities has so far taken the first view. In this paper, we have argued the importance of reckoning inequality in socio-economic group terms and advocated use of an ‘education concentration index’ exactly in the same way as the health concentration index measures socio-economic inequalities in health. The index has been applied to the Indian data to reckon two kinds of inequalities in educational attainment (years of education) – one across economic classes and the other across socially identified groups such as the Scheduled Tribes, Scheduled Castes and others. We find a strong correlation between the two types of inequalities across the states of India. We also find, as one would expect, that the inequality index values are negatively correlated with the average years of education. However, in actual policy context, analysis of the outliers...
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...Education and Income Inequality: A Meta-Regression Analysis Abdul Jabbar Abdullah* Hristos Doucouliagos Elizabeth Manning - FIRST DRAFT - Please do not quote without permission from the authors September 2011 Abstract This paper revisits the literature that investigates the effects of education on inequality. Specifically, the paper provides a comprehensive quantitative review of the extant econometrics literature through a meta-regression analysis of 64 empirical studies that collectively report 868 estimates of the effects of education on inequality. We find that education affects the two tails of the distribution of incomes; it reduces the income share of top earners and increases the share of the bottom earners, but has no effect on the share of the middle class. Inequality in education widens income inequality. Education has a larger negative effect on inequality in Africa. The heterogeneity in reported estimates can be largely explained by differences in the specification of the econometric model. JEL Codes: I24, C01 Keywords: Education, inequality, meta-regression analysis Number of words: 12,683 * Corresponding author. Abdullah: Universiti Teknologi Mara Sarawak Campus, Malaysia and PhD Candidate Deakin University, ajabd@deakin.edu.au Doucouliagos: School of Accounting, Economic and Finance, Deakin University, douc@deakin.edu.au Manning: School of Accounting, Economic and Finance, Deakin University, elizabem@deakin.edu.au 1 Education and Income Inequality:...
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...Socioeconomic inequalities in the Health and Nutrition of Children in Low/Middle Income Countries: Discussion Summary Antonio Taylor Stratford University HCA 505: Global Health Professor Ostrander January 27, 2016 Socioeconomic Inequalities in the Health and Nutrition of Children in Low/Middle income Countries: Discussion Summary Introduction Child malnutrition remains one of the world’s most fundamental challenges for improved human development. Because the time and capacities of caregivers are limited, there are too many children in the world that are unable to access and effectively use at all times the food and healthcare services they need for a healthy life. Hundreds of millions of children in less developed countries suffer from poor health can nutrition. Children in most less developed countries also complete far few years of schooling, and learn less per year in schooling, than their counterparts in developed countries. Recent research has shown that poor health and nutrition among children reduces their time in school and their learning during that time. Background There is a long standing tradition of research on socio-economic health inequalities in contemporary high income countries. Early studies in the socioeconomic inequalities were often done by physicians engaged in social movements, who focused on the influence of living conditions on health. Attention for socio-economic health inequalities have been changing since the 19th century. At...
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