Inequality and Redistribution - 1384 Words

Inequality and Redistribution Income inequality in America is higher than in any other industrial nation in the world. Many believe this creates serious problems for both United States citizens and its economy. The inequality difference is continually getting larger and worsening these problems. Over the past three decades America’s economy has seen continuous growth; but this is accompanied with no increase in purchasing power for poor and middle class citizens. On the other hand, incomes of the richest Americans have dramatically increased, which only furthers the gap between social classes. In 2008, the top one percent of Americans earned over 20% of the national income, which is significantly higher than only 50 years ago. Economists use a strategy called the â€Å"Gini Coefficient† to measure the relative equality between nations. Since 1980, the Gini Coefficient for the United States has risen from 0.388 to 0.45. This is a very high rating compared to other egalit arian countries, such as most of Europe and Japan, whose ratings are generally in the high 0.2s and low 0.3s. Wealth inequality is even greater than income inequality, however. â€Å"The top 1 percent of Americans own forty-four hundred times as much wealth per person as the bottom 40 percent.† This large difference between rich and poor American citizen wealth and income creates numerous problems for the United States. The United States is based on one strong principle belief, democracy. Democracy is supposed toShow MoreRelatedIncome Redistribution And Its Key Pros1460 Words   |  6 PagesIncome Redistribution Income redistribution refers to the concept of transferring income from the wealthy individuals to the less wealthy individuals through social mechanisms such as monetary policies, charity, welfare, land reforms, and taxation among others. Income redistribution affects the entire economy rather than selected groups of individuals. The concept of income redistribution emanates from the existence of income inequalities within an economy. Income inequality depicts a gap betweenRead MoreEconomic Inequality In The United States Has Risen And1042 Words   |  5 PagesEconomic inequality in the United States has risen and absolute growth has slowed over the past half-century. This growing level of inequality sparks in a wave of support for redistribution. The U.S.’s inability to redistribute to the bottom quartile of the income distribution results a multitude of factors that explain why people would support or oppose redistribution. An explanation of economic inequality involves th e argument that the wealthy have the needed resources in order to flourish in achievingRead MoreIssues Of Inequality And Poor Healthcare Essay1694 Words   |  7 PagesIssues of inequality and poor healthcare, while are arguably equal in importance to the livelihood of human beings, differ in the tractability for change. The analysis of inequality is necessary due to the fact that inequality inhibits economic growth and social mobility, impairs democracy, and eludes a certain standard of fairness. Social mobility is the ability for individuals or families to move between social classes. Heavily rooted inequality inhibits such movement due to the fact that theRead MoreThe Study Of Democratization Has Been A Key Cornerstone1558 Words   |  7 Pageswith focus now on the role of income inequality in explaining democratization. Yet, even within the study of inequality, there have been two primary competing theories (Boix, Acemoglu and Robinson), that have come up with conflicting implications. Ansell and Samuels(AS) propose a third theory aimed at addressing critical issues involved with both studies, and provides an in-depth analysis on why there have been mixed findings for the study of income inequality, but economic development in generalRead MoreThe Ottawa Citizen, By Justin Trudeau Essay1735 Words   |  7 Pagestitled â€Å"Q and A: Why Justin Trudeau says he’s the real alternative†, where he shares his plan to increase taxation on the rich in order to give the middle class a tax break. This plan is in response to the larger issue of income inequality in Canada. Analysing the income inequality from a liberal â€Å"justice as fairness† perspective, one can conclude that Justin Trudeau is taking the correct action, as taxation on the rich is in compliance with the two principles of justice as described by John Rawls. InRead MoreDomestic Inequalities in The USA and Denmark Essay1489 Words   |  6 Pagespolicy approaches to addressing domestic inequality. Compare and contrast two different countries and evaluate the effectiveness of their key policy measures in addressing inequality. It is a commonly accepted that inequality is increasing throughout the globe, with startling statistics such as the recent Oxfam report indicating that the richest 85 people in the world own more wealth than the poorest 3.5 billion people(Oxfam Australia Media, 2014). Inequality is thought of as disparities or gaps, suchRead MoreThe Issue Of Taxation Of The United States Essay1659 Words   |  7 Pagesmeans the only example.† Sowell is pointing out the major flaw in that wealth redistribution is ineffective at distributing money to the poor. However, redistribution is highly effective at taking the wealth away from the successful. Wealth redistribution does not work in favor of anyone and is a concept that is unjust to the wealthy. Another famous economist who commented on the issues of programs aimed at wealth redistribution was Dr. Nathaniel Hendren, who is on the faculty at Harvard University inRead MoreJohn Stuart Mill And Income Inequality1721 Words   |  7 PagesIncome Inequality Many great economic thinkers throughout history has offered various differing yet interrelated views and ideas that may prove useful to the analysis of current issues in modern economics. A persistent issue in the modern economy is income inequality whereby the distribution of income among the population is unequal. This means that the gap between the rich and the poor increases over time if the issue is not appropriately addressed. In exploring the issue of income inequality in AustraliaRead MoreThe Central Banking Authority Of The United States And Is Responsible For Regulating Monetary Policy Essay1459 Words   |  6 Pagesforeign exchange markets. They do this with the intention to help the economy as a whole, not one specific sector. Unfortunately, it is difficult to do all this for the entire economy with money constantly changing hands. These results of the redistribution of money are known as redistributive consequences of monetary policy. These consequences can be seen thro ughout many different parts of monetary policies, and some are even significant enough that policy makers have started taking them into accountRead MoreThe Inequality Of Poverty And Deprivation Throughout The World1368 Words   |  6 Pagesfirst about the glaring inequalities of income and wealth, both within and between countries. But inequality is only part of the story, and depending on the place and the time period in question, it may not be the most important part of the story. It may be that other policies, in addition to redistributing income directly, have a vital role to play in reducing inequality. In the past year, there has been something of a revival of the public policy debate on inequality of income and wealth, a welcome