Weeks One - Six Flashcards
(34 cards)
What is inequality?
The unequal distribution of something
Dimensions of inequality?
Wealth, Income, Power, Opportunity
How is inequality measured?
GINI - Gross National Income
What is PPP?
Purchasing Power Parity
What are Proportional Share Indices?
The income of the richest decile ratioed to the income of the poorest decile
Key points of Pickety and Saez (2014)?
Used World Top Income Database to map income distributions in US and Europe.
Wealth inequality greater in the US
Wealth-to-income holds a U-distribution
What is fiscal deregulation?
Removing rules surrounding income and tax
Wealth equation?
Wealth = Income - spending + inheritance + luck
From where is the GINI Coefficient derived?
The Lorenz curve - plots the richest x poorest cumulative income
What is perfect equality vs perfect inequality?
0 = Perfect GINI Equality, 1 = Perfect GINI Inequality
How is the GINI coefficient limited?
Entirely descriptive - tells us there is inequality but not why
What is Theil’s T+L?
Shows whether inequality is due to reasons within or between areas
What did Friedman believe about inequality?
It is inevitable and even desirable as a motivator
Inherited talent is as valuable as inherited wealth
What did Wilkinson and Pickett believe about inequality?
It can only be negative - “The Spirit Level” theory states that inequality erodes trust, promotes excess and increases anxiety in society
What does Branko Milanovic say about geographic inequality?
Luck and effort can change personal circumstances, but not overall inequality
Efforts need to be combined with overall country improval and migration to improve global income position of nations
What did Barone and Mocetti study?
Cyclical wealth transfers in Italy - earning elasticity of 5%, wealth elasticity of 10%
What did the Cycle 8 European Social Survey show?
Welfare attitudes - huge variations across countries as to whether income should differ to reward effort.
Strong agreeance that equal societies should have few wealth differences
Irish people grossly overestimate unemployment levels
Most people want inequality levelling to improve the bottom % rather than impede the top
Those exposed to inequality are most likely to oppose its potential upsides
Compare inequality of outcome to inequality of opportunity
Outcome = variation in resource distribution Opportunity = variation in potential to get these resources
What four factors influence social attitudes towards inequality?
What do they believe to be the source (wealth vs talent)
Imagining/personal depictions of inequality
Efficiency of inequality
Fairness
Compare benign and malign drivers of inequality
Benign = globalisation, technology, demographic changes Malign = epidemics, war, slavery
What four benign factors does Branko believe will reverse inequality cycles?
Politics, Education, Competition, Technology
Who are Groups A, B, and C in global income distributions?
Group A - the median, an emergent middle class from Asian economies
Group B - Richer than A but poorer than C, the ‘losers’ of globalisation as they see no income increase unlike the others, no benefit from neoliberal globalisation
Group C - The richest, global plutocrats
What is import shock?
The belief that jobs are at a loss due to imports, a higher driver for Brexit than racism, associated with negative attitudes towards immigration rather than immigrants themselves
Outline Kuznet’s ideas on within-country inequality
Economic development can both increase and decrease inequality
There will be a proliferation of jobs/wages should there be no intervention in inequality
Wage variation is difficult to suppress