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Income & Wealth Inequality
Income & Wealth Inequality
Nick Name
Income Inequality
Income Equality measure the difference in incomes between the rich and poor.
More about Income & Wealth Inequality
Discusses The Following
Terms
Gini Coefficient
Tyranny of Averages
Mentioned by the Following
People
Mark Blyth
Thomas Piketty
Publications
Austerity
Macro Markets
Naked Economics
Peers Inc
Terms
Middle Class
Experts
Mark Blyth
Thomas Piketty
Child Terms
Notes
There are multiple ways do measure it
A common way to measure it is using the
Gini Coefficient
The Gini coefficeficient ranges from 0 to 1.
The higher the coefficient, the more unequal things are
There is no set definition for who is rich and who is poor
Looking at the top 1% is a common metric for those who are "rich"
Looking at average incomes for entry level employees or minimum wage is a way to analyze those who are "poor"
Also referred to as "The Wealth Gap"
Contributors Vs. Leaches
One theory is that people/firms who leach on the financial system increase inequality:
Example: JP Morgan Chase &
Jamie Dimon
Jamie Dimon
did not create
the firm
, but is a billionaire from it
JP Morgan pays it's
CEO
and Executives huge compensation packages, but barely pays deposit holders anything
This is in contract to people/firms that create
value
by making or improving the way we live:
Examples:
Henry Ford
and the assembly line; Edison and the light bulb
Concerns As of 2018
Inequality is growing in the
US
Also growing in rest of world:
China
,
Europe
,
Japan
, etc.
Inequality Throughout
History
Recent inequality is nothing new
Almost every
civilization
has experience it - it's natural to humans
Typically ends with
Revolution
: the people revolt and redistribute wealth
war/sickness/famine/natural disasters: many people die
With reduced numbers, there is more
demand
for laborer
With more
demand
, they can negotiate better
wages
and a larger share of the pie