However, some critics of income inequality will argue that it will always be present and is necessary to stimulate growth. Nonetheless, the problem is not only that the gap between the poor and the rich is widening but that income inequality is causing devastating market and government failures. We look in particular to the case of the United States. The US is the world’s leading power and hegemon, who also has the world’s highest GDP and GDP per capita. However, in recent years the gap between the rich and the poor has been growing at a fast pace.
Those incentives of higher income are becoming scarce and costly, and many people think it isn’t worth the work to reach it. The larger the gap between the social classes, the more prominent social classification becomes, and the more we, as citizens and human beings, should be prepared to make a stand for the basic right of standard of living that was initiated by our independence. Works Cited The Simple Truth about the Gender Pay Gap (Fall 2014) http://www.aauw.org/research/the-simple-truth-about-the-gender-pay-gap/ John H. Hinderaker and Scott W. Johnson, “The Truth About Income Inequality” http://www.americanexperiment.org/publications/reports/the-truth-about-income-inequality
On the other hand, 4 out of 5 of Asia most populous countries -India, China, Bangladesh and Indonesia- have seen income inequality gone up since 1990s (Asian Development Bank, 2012). This is a bigger issue for developing countries as effects of inequality can have major implications on economic development. Developing countries around the world have an objective of increasing income levels or GDP, reducing poverty and increasing living standards measured by social indicators such as literacy rate, schooling years, and life expectancy. The efforts to reach these objectives are then hampered by increasing income inequality. I will explore the relationship between income inequality and economic development by looking at three channels on how income inequality might do so.
One proposed reason for this harsh reality of high poverty rates is globalization - the growing integration of economies and societies around the world. The claim that globalization generates poverty has been the focus of many debates for the last twenty years, including the debate between Carlos Caretto, Gillian Crowl, Steve Grossman, and Annie Wong on February 21, 2014. Caretto and Crowl argued that poverty is an indirect result of globalization as is evident by high unemployment rates, wage inequality, and diminishing health and educational programs. Grossman and Wong contended that globalization does not generate poverty, but it in fact helps the world by promoting education, decreasing and shortening the length of wars, and increasing new resources. Close examination of the facts presented in lectures, readings, and the debates shows that each side presents logical evidence, but the facts confirm that globalization does in fact generate poverty.
Income inequality continues to increase in today’s world, especially in the United States. Income inequality means the unequal distribution between individuals’ assets, wealth, or income. In the Twilight of the Elites, Christopher Hayes, a liberal journalist, states the inequality gap between the rich and the poor are increasing widening, and there need to have things done - tax the rich, provide better education - in order to shortening the inequality gap. America is a meritocratic country, which means that everybody has equal opportunity to be successful regardless of their class privileges or wealth. However, equality of opportunity does not equal equality of outcomes.
The Ways to Battle Income Gap and Lift Poverty Income inequality in America has been growing remarkably for decades since the gilded age. The phenomenon is depressingly pervasive among working classes, women and minorities. Income inequality creates caste classes and poverty, from colonial period to industrial revolution in 19th century, and to globalized economy of 21st century, and the process of widening income gap has nevertheless become ubiquitous. What is an effective tool to combat the out-of-control spiral of such gap is a usual controversial issue and had been debated endlessly. Some critics believe the government should be taking control on tax policy to effectuate the redistribution of income, while others believe a comprehensive political reform to revolutionize the nation’s fundamental social system is the only solution.
There are many causes of income inequality. Executives and Wall Street are a cause of income inequality. Increased incomes for CEOs and financial sector professionals account for 58 percent of the top 1 percent of the income distribution and 67 percent of the top 0.1 percent. So the specific dynamics of compensation in those areas are wielding a big influence. Superstar effects is another cause of income inequality.
These factors work against each other in the way that, you need a good education to get a good paying job and vice versa... ... middle of paper ... ... High inequality usually influences less upward mobility. As the rich become more rich, the poor become even more poor. Segregation leads to slower economic mobility, which causes poor family structure and government spending in communities. Income inequality remains such a prevalent issue due to the greed and prejudice in the capitalistic society, which pushes the gap between social classes further away from each other causing the working class to remain poor. As this topic remains such a compelling problem for the past 50 years, America must come together to support and help pull those who are stuck in the trap we call poverty.
The development process of any country is measured using different indicies/method . The one of these indicies, which is most commonly used in the world is economic growth. Economic growth shows the capacity increases in the amount of goods and services produced in the economy and also shows the productive capacity of an economy, it is also shows the national income of any country. In Pakistan unemployment and inflation play an important role. Both are the major issues in Pakistan.
World Bank’s World Development Indicators 2001), Wade emphasized the high margin of error on such studies with some major developing countries, such as India, not included in the data. Therefore, he concluded the total number of those living in poverty at any point in time is speculative and cannot accurately be determined; however, the he iterated the gap between the wealthy and poor continues to grow because of globalization. To address the inequity in the distribution of resources around the world, individuals have formed grass-root international non-government organizations (INGOs) over the past number of decades. Boli and Thomas (2012) noted the steady increase of INGOs since the first organizations were established in the late 1870’s. These organizations originated to operate for the common good of humanity without the constraints of governmental politics.