Questions tagged [inequality]

Differences in resource allocations or opportunities that arise within or between countries.

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What does New Trade Theory say about the effect of trade on (income) inequality?

The Heckscher-Ohlin model and Stolper-Samuelson theorem make predictions about the effects of trade on the distribution of income within countries. What does New Trade Theory say about this?
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Can you classify EU countries into developing and industrialised, or are they all industrialised?

The Heckscher-Ohline model and Stolper-Samuelson theorem state that the relation between inequality and international trade is moderated by the level of economic development. I am studying this ...
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A question about "welfare independence"

I am working on some applications of measures of inequality (economic inequality). Upon reading a paper by Kolm (Kolm, S. C., Unequal Inequalities. I, Journal of Economic Theory, 12 pp 416-442, 1976) ...
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An updated version of oxfam top 1% wealth share evolution to 2021

In January 2015 oxfam allegedly published this graph: Q: I'd like to see how that projection held up, by getting the updated data with a comparable methodology. Here is the original document https://...
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Comparison of two variables

I have a model where I have to compare the values of y(x) and z(x). But expressions are complex and what I am getting is $x= f(y(x))= \frac{\sin({y(x)}) + \sqrt{(y(x))^3}}{(\frac{y(x)}{1-y(x)}) ^{1/4}}...
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What percentage of utils do the top 1% pay in tax

A commonly cited statistic in American politics is the top 1% of Americans earn 20% of all income, but may 40% of all income taxes. This is measured in dollars, however, and a dollar is worth more to ...
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Is it always a trade off between efficiency and equity?

Is there any situations where we can achieve both equity and efficiency? I'm thinking of Covid 19 vaccine program which is run by Goverment. Although the cost for the program is paid by the money from ...
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Literature recommendation

Classic economic theory suggests people earn wages according to their productivity. Over time CEO's, directors, managers and the like seem to earn more relative to the 'normal worker'. Lets call this ...
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Can the monetary policy affect wealth inequality? [duplicate]

I think that it is often assumed that monetary policies have little or no impact on inequality. At least in the public the monetary policy is not seen as a political question the same way that fiscal ...
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Could the Feds objectives be adjusted to decrease or at least not increase wealth inequality?

The US congress "has assigned the Fed to conduct the nation’s monetary policy to support the goals of maximum employment, stable prices, and moderate long-term interest rates."(1) It seems ...
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Why do many occupations show a gender bias?

Yesterday we had a question about the alleged underpayment of women in work, asking why employers would hire fewer cheaper female workers and would instead hire a larger number of expensive male ...
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If women are paid less for the same work, why don't employers hire just women?

If women are paid less for the same work, why don't employers hire just women? Do employers decide to lose profits just out of sexism, in feminists' and researchers' opinion? It doesn't make sense to ...
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How does everyone not become poor over time?

Look at the whole world --the union of all goods and services and workers and customers. Everyone who is a customer is a worker somewhere (they had to get the money to be a customer somehow). But not ...
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Is it viable to put a cap on personal wealth in the U.S.?

Setting a cap on personal wealth is a proposal that has been championed by several progressive politicians in the U.S. (Sanders, Ocasio-Cortez, etc.). From what I understand, they argue that by ...
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Is inequality a micro or macro economics issue?

In a clear and comprehensive blog post, Tejvan Pettinger describes economics problems. He starts by making brief considerations on scarcity, enumerates the fundamental economic problems (what/how much ...
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Can you prove, and with what assumptions, that a market will allocate some minimum amount of basic resources to every worker?

I'm looking for a summary/less technical answer, as I'm not very well versed in the details of economic theory. I'm curious if there is some way to show that under some circumstances in a market ...
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Does quantitative easing favour banks?

The reserve bank recently announced it would print $100B over 6 months, and spend this buying back gov bonds. Will this policy advantage the financial sector over other parts of the economy? Why ...
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Lorenz curve extension to 3d?

While thinking about Lorenz curves and economic inequality I wondered if you can extend Lorenz curves to Lorenz surfaces by revolving a Lorenz curve about the line of perfect equality. Would such a ...
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Can demand side restrictions explain the productivity paradox (Solow paradox)?

Productivity paradox https://en.wikipedia.org/wiki/Productivity_paradox is the name for the slow productivity growth (i.e. slow GDP growth) of the developed economies despite the robotics, AI, ...
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Does Singapore's computation of the Gini coefficient exclude low-paid foreign workers?

The Economist (2015-07-16): But Singapore measures its coefficient rather differently, excluding shorter-term foreign workers and non-working families. More generally, how is Singapore's Gini ...
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Capital/Income Ratio in Pikketty's Capital

In Capital by Thomas Pikketty, https://www.robertdkirkby.com/blog/2015/summary-of-piketty-i/, he states that World War I and World War II were the main reasons why the Capital Income to Labour Income ...
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Do rich people on average have the vast majority of their wealth invested or they have lots of liquid cash/no productive properties?

I often read about really rich people with billions of dollars, and I'd like to know if they have, for example, just a big part of their wealth in shares of their company or they have lots of wealth ...
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How much heath expenditure is due to conditions that people are born with?

The CDC says that 90% of US healthcare costs are attributable to chronic conditions. I am interested in an overlapping set of conditions: those that people are born with, including genetic diseases, ...
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Inequality and recessions

I was reading about Marx's Crisis Theory. On one hand, there is this idea of the falling surplus. But on the other hand, he relates income inequality to the business cycle. Have his ideas regarding ...
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What does Piketty mean by the C90/C10 ratio?

I am currently readings Piketty's "The Economics of Inequality", where he states in chapter 3: The P90/P10 wage ratio in the United States in the 1990s is 4.5, whereas it is “only” 3.2 in France (...
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Why is imputed rental income for owner-occupied housing included in the measurement of household income?

In the National Income Dynamics Study in South Africa, total household income is measured by totalling labour income, government income, investment income, capital income, agricultural income, ...
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Are Open Market Operations a Gift to the .1%?

My Background I was an Economics major a long time ago and I don't work in a related field. I have this question that's been nagging me. I hope somebody can answer the questions at the bottom. ...
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What do all the distributions that have the same Gini index have in common?

According to the Wikipedia article about Income inequality metrics, Gini index have the next disadvantage: As a disadvantage, the Gini index only maps a number to the properties of a diagram, but the ...
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What does the vertical axis of the Kuznets curve depict (mathematically)?

I do not understand what does the word "inequality" means on the vertical axis of the Kuznets curve. Can someone please explain?
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What policies can a government adopt to promote economic equality?

As per the Oxfam survey, Top 1% owns more than the bottom 50% of the population. There is also an enormous wage gap emerging, such as that our average CEO makes something like 200x much more than ...
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Where is the split in the wealth gap? [closed]

I've been curious where the split in the wealth gap has been over time, and if it was possible to graph it. Put another way, at what net worth is the number of those worth more shrinking in ...
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Have Raj Chetty's Opportunity Atlas stats changed or been recalculated since early 2019?

During a talk at Google, Raj Chetty said "Fruitvale, in Oakland ... here you see that for black men growing up in low income families in Fruitvale, the average income in adulthood is 5,600 dollars" (...
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Income/Wealth Inequality; Why does it matter?

I have attempted to answer this question on my own through reading books, blog, and other economic pieces of literature but they all fail to articulate why wealth or income disparities matter. Now ...
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Combine Gini index with GNI/capita (PPP) to produce an indicator which gives the same weight to low percentile incomes as to high percentile incomes

Consider the attached charts, which illustrate that low-inequality Country A can have both a lower average income and higher average log income than high-inequality Country B. This sparked my interest ...
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Is Buy Nothing Day a classist protest of Black Friday?

I hope this isn't off topic, it seems specifically economic to me even though it probably intersects with other fields of study. Black Friday is seen as an iconic hallmark of consumerism, and Buy ...
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Are there any effective research efforts into combating wealth inequality?

There seems to be no "correct" answer in combating wealth inequality; however, we should attempt to use different methods to combat inequality in cities, then counties, then states, then countries. ...
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Kuhn Tucker Maximization

I have to maximize following expected utility function using Kuhn tucker conditions - Since expected utility function are increasing $C_{1,t}$ and $C_{2,t}$ so constraints (i) and (ii) will hold with ...
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Data for income distributions

Knowing the average income per capita or the median income is a rather poor economical indicator of a country, even when given in PPP\$. Knowing the (dimension-less) Gini index is somehow better, but ...
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What impact does deficit spending have on economic inequality?

Taxation schemes can be classified as progressive (the tax rate is higher for higher income brackets), regressive (the tax rate is lower for higher income brackets), or neutral (the tax rate is the ...
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Social mobility and income inequality

I once read an argument by the libertarian economist Thomas Sowell against the conventional wisdom that rising income is bad because most statistics which show rising income inequality do not account ...
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What is the relationship between economic growth and equality?

Does economic growth create more or less equality?
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Fehr & Schmidt, ultimatum game, inequaltiy aversion, perfect subgame Nash equilibrium

I am preparing for an exam. I have found an old exam but I have no solutions for it, so I tried to solve it, but I dont know if I did it correctly and need therefore your help. The problem looks as ...
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Why does Denmark have such a huge disparity between its income and wealth Gini coefficients?

(After-transfer) income inequality and wealth inequality are obviously not the same thing, but I would intuitively expect that, all else equal, they would be reasonably well correlated across ...
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Ideal levels of inequality

Has any work been done to try to figure out what a productive level of wealth and income inequality is in a country? i.e. the minimum to provide incentive for 'hard' work, and necessary risk taking in ...
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World Inequality Database: Top 10% Income Share U.S. vs. Top 10% Average Income

I want to use the U.S. data from the World Inequality Database for a VAR analysis. However, I am confused as to why the series for the top 10% income share only runs back to 1962, while the series for ...
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What if price were a function of buyer's income?

If everyone's income were public information, would purely profit-seeking sellers benefit from charging different prices to people based on their different incomes? My intuition says yes because a ...
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Does PPP measure conversion taken into account government service and taxes?

Apology in advance if this question seems too elementary. I am intrigued by this article I came across,Do We Care About Income Inequality, or Absolute Well-Being? And in the article the author was ...
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Data Set of Bourguignon and Morrison 2002 AER

This question is about the following paper: F. Bourguignon and C. Morrison "Inequality among World Citizens: 1820-1992", American Economic Review, Vol. 92, No. 4. (Sep., 2002), pp. 727-744. On p.730,...
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labor share and growth

Is there a link between the level of the labor share and growth? In standard models growth is the rate of (labor augmenting) technical progress and labor force. So does that mean if the labor share ...
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Is there an income inequality metric which also considers the total income?

I'm trying to compare some data I have about two companies, and in order to do so I need to compare their income inequality, but also to take in consideration the total income of each. For example if ...
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