View source for Social:Economic inequality

{{Short description|Distribution of income or wealth between different groups}}

[[File:Income inequality - share of income earned by top 1% 1975 to 2015.png|thumb|upright=1.5|Share of income of the top 1% for selected developed countries, 1975 to 2015]]
[[File:GINI index World Bank up to 2018.png|alt=|thumb|upright=1.7|Differences in national income equality around the world as measured by the national Gini coefficient as of 2018.<ref name="auto">{{Cite web|title=GINI index (World Bank estimate) {{!}} Data|url=https://data.worldbank.org/indicator/SI.POV.GINI?view=map|access-date=July 23, 2020|website=data.worldbank.org}}</ref> The Gini coefficient is a number between 0 and 100, where 0 corresponds with perfect equality (where everyone has the same income) and 100 corresponds with absolute inequality (where one person has all the income, and everyone else has zero income).]]
[[File:Global Wealth Distribution 2020 (Property).svg|thumb|upright=1.15|Global share of wealth by wealth group, Credit Suisse, 2021]]
{{multiple image | direction = horizontal |total_width=450
 | header = Wealth disparity in major cities
 | image1= Tenting in Los Angeles Skid Row.jpg | alt1 = Skid row tents | caption1 = Tents of the homeless on the sidewalk in Skid Row, Los Angeles
 | image2 = The Manor, Holmby Hills, Los Angeles, in 2008.jpg | alt2 = a Beverly Hills mansion | caption2 = An affluent house in Holmby Hills, Los Angeles, roughly 12 miles from downtown
}}
'''Economic inequality''' is an umbrella term for a) income inequality or distribution of income (how the total sum of money paid to people is distributed among them), b) wealth inequality or distribution of wealth (how the total sum of wealth owned by people is distributed among the owners), and c) [[Finance:Consumption (economics)|consumption]] inequality (how the total sum of money spent by people is distributed among the spenders). Each of these can be measured between two or more nations, within a single nation, or between and within sub-populations (such as within a low-income group, within a high-income group and between them, within an age group and between inter-generational groups, within a gender group and between them etc, either from one or from multiple nations).<ref name="urlWealth Distribution and Income Inequality by Country 2018 | Global Finance Magazine">{{Cite web|url=https://www.gfmag.com/global-data/economic-data/wealth-distribution-income-inequality |title=World Wealth Distribution And Income Inequality 2022 |first1=Luca |last1=Ventura |website=Global Finance Magazine |date=June 6, 2023 }}</ref>

[[Finance:Income inequality metrics|Income inequality metrics]] are used for measuring income inequality,<ref>{{cite journal |last1=Trapeznikova |first1=Ija |title=Measuring income inequality |journal=IZA World of Labor |date=2019 |doi=10.15185/izawol.462 |url=https://wol.iza.org/articles/measuring-income-inequality|doi-access=free }}</ref> the [[Finance:Gini coefficient|Gini coefficient]] being a widely used one. Another type of measurement is the Inequality-adjusted Human Development Index, which is a statistic composite index that takes inequality into account.<ref>Human Development Reports. [http://hdr.undp.org/en/content/inequality-adjusted-human-development-index-ihdi Inequality-adjusted Human Development Index (IHDI)] {{Webarchive |url=https://web.archive.org/web/20190712222023/http://hdr.undp.org/en/content/inequality-adjusted-human-development-index-ihdi |date=July 12, 2019}}. ''United Nations Development Programme''. Retrieved: March 3, 2019.</ref> Important concepts of equality include [[Finance:Equity (economics)|equity]], [[Social:Equality of outcome|equality of outcome]], and equality of opportunity.
Whereas globalization has reduced the inequality between nations, it has increased the inequality within the population in most nations.<ref name=":9">{{Cite web |title=Introduction to Inequality |url=https://www.imf.org/en/Topics/Inequality/introduction-to-inequality |access-date=May 9, 2022 |website=IMF |language=en}}</ref><ref name=":10" /><ref name=":11" /><ref name=":12" /> Income inequality between nations peaked in the 1970s, when world income was distributed bimodally into "rich" and "poor" countries. Since then, income levels across countries have been converging, with most people now living in [[Finance:Newly industrialized country|middle-income countries]].<ref name=":9" /><ref>{{Cite web |date=January 22, 2010 |title=Parametric estimations of the world distribution of income |url=http://www.voxeu.org/index.php?q=node/4508}}</ref> However, inequality within the population in most has risen significantly in the last 30 years, particularly among [[Finance:Developed country|advanced countries]].<ref name=":9" /><ref name=":10">{{Cite book|last1=Bourguignon |first1=François |url=http://press.princeton.edu/titles/10433.html |title=The Globalization of Inequality |date=2015|publisher=Princeton University Press |isbn=978-0691160528|access-date=August 19, 2017}}</ref><ref name=":11">{{Cite journal|last=Hung|first=Ho-Fung|date=2021|title=Recent Trends in Global Economic Inequality |journal=Annual Review of Sociology|volume=47|issue=1|pages=349–367|doi=10.1146/annurev-soc-090320-105810 |s2cid=235574406|issn=0360-0572}}</ref><ref name=":12">{{Cite journal |last1=Flaherty|first1=Thomas M. |last2=Rogowski |first2=Ronald|date=2021|title=Rising Inequality As a Threat to the Liberal International Order |journal=International Organization|volume=75|issue=2|pages=495–523 |doi=10.1017/S0020818321000163 |issn=0020-8183|doi-access=free}}</ref> In this period, approximately 90 percent of advanced nations increased their income inequality with over 70% nations recording their [[Finance:Gini coefficient|Gini coefficient]] increase, exceeding two points.<ref name=":9" />

Research has generally linked economic inequality to political and social instability, including [[Social:Revolution|revolution]], democratic breakdown and civil conflict.<ref name=":9" /><ref>{{Cite journal |last1=MacCulloch |first1=Robert |year=2005 |title=Income Inequality and the Taste for Revolution |journal=The Journal of Law and Economics |volume=48 |issue=1 |pages=93–123 |doi=10.1086/426881 |jstor=10.1086/426881 |s2cid=154993058}}</ref><ref name=":5">{{Cite book |last1=Acemoglu |first1=Daron |url=https://www.cambridge.org/core/books/economic-origins-of-dictatorship-and-democracy/3F29DF90519971B183CAA16ED0203507 |title=Economic Origins of Dictatorship and Democracy |last2=Robinson |first2=James A. |date=2005 |publisher=Cambridge University Press |isbn=978-0521855266 |location=Cambridge |doi=10.1017/cbo9780511510809}}</ref><ref name=":6">{{Cite book |last1=Cederman |first1=Lars-Erik |last2=Gleditsch |first2=Kristian Skrede |last3=Buhaug |first3=Halvard |title=Inequality, Grievances, and Civil War |url=https://www.cambridge.org/core/books/inequality-grievances-and-civil-war/39F26D12EFEE2D7D621A59DF74DED496 |publisher=Cambridge University Press |year=2013|isbn=978-1107017429|doi=10.1017/cbo9781139084161}}</ref> Research suggests that greater inequality [[Finance:Economic growth#Inequality and growth|hinders economic growth]] and macroeconomic stability, and that [[Finance:Land (economics)|land]] and [[Social:Human capital|human capital]] inequality reduce growth more than inequality of income.<ref name=":9" /><ref name=":0">{{cite journal |last1=Neves |first1=Pedro Cunha |last2=Afonso |first2=Óscar |last3=Silva |first3=Sandra Tavares |year=2016 |title=A Meta-Analytic Reassessment of the Effects of Inequality on Growth |journal=World Development |volume=78 |pages=386–400 |doi=10.1016/j.worlddev.2015.10.038}}</ref> Inequality is at the center stage of economic policy debate across the globe, as government tax and spending policies have significant effects on income distribution.<ref name=":9" /> In advanced economies, taxes and transfers decrease income inequality by one-third, with most of this being achieved via public social spending (such as [[Finance:Pension|pensions]] and family benefits).<ref name=":9" />  While the "optimum" amount of economic inequality is widely debated, there is a near-universal belief that complete economic equality (Gini of zero) would be undesirable and unachieveable.{{ r | Peterson_2017 | p=1 | q=It is important to note that virtually no-one believes complete equality in the distribution of income and wealth is a desirable state of affairs. There is no clear agreement that an optimal level of inequality would be achieved at some given value for the Gini coefficient but there does appear to be widespread agreement that a value of zero would be unsuitable as well as impossible to achieve. The evidence from the Twentieth Century, however, shows that there can be great general prosperity with lower economic inequality than at present so that, given the clear distress caused by rising inequality, lowering it appears to be a worthy aspiration. }}


==Measurements==
{{Main|Finance:Income inequality metrics|Finance:List of countries by income equality}}

In 1820, the ratio between the income of the top and bottom 20 percent of the world's population was three to one. By 1991, it was eighty-six to one.<ref>{{Cite book|title=The World Transformed: 1945 to the Present|last=Hunt|first=Michael|publisher=Bedford/St. Martin's|year=2004|isbn=978-0312245832|location=Boston|pages=[https://archive.org/details/worldtransformed0000hunt/page/442 442]|url=https://archive.org/details/worldtransformed0000hunt/page/442}}</ref> A 2011 study titled "Divided we Stand: Why Inequality Keeps Rising" by the Organisation for Economic Co-operation and Development (OECD) sought to explain the causes for this rising inequality by investigating economic inequality in OECD countries; it concluded that the following factors played a role:<ref name="PR divided">{{cite report| url= http://www.oecd.org/document/22/0,3746,en_21571361_44315115_49185046_1_1_1_1,00.html |title=Press Release for Divided We Stand: Why Inequality Keeps Rising| publisher=OECD| author=Gurría, Angel| date=December 5, 2011| access-date=December 16, 2011| doi=10.1787/9789264119536-en|isbn=9789264111639}}</ref>
* Changes in the structure of households can play an important role. Single-headed households in OECD countries have risen from an average of 15% in the late 1980s to 20% in the mid-2000s, resulting in higher inequality.
* [[Biology:Assortative mating|Assortative mating]] refers to the phenomenon of people marrying people with similar background, for example doctors marrying other doctors rather than nurses. OECD found out that 40% of couples where both partners work belonged to the same or neighbouring earnings deciles compared with 33% some 20 years before.<ref name="oecd-dws">{{cite book|title=Divided We Stand: Why Inequality Keeps Rising|date=2011|publisher=OECD|isbn=978-9264119536 |doi=10.1787/9789264119536-en}}{{page needed|date=September 2018}}</ref>
* In the bottom percentiles, number of hours worked has decreased.<ref name="oecd-dws"/>
* The main reason for increasing inequality seems to be the difference between the demand for and supply of skills.<ref name="oecd-dws"/>
The study made the following conclusions about the level of economic inequality:
* Income inequality in OECD countries is at its highest level for the past half century. The ratio between the bottom 10% and the top 10% has increased from 1:7 to 1:9 in 25 years.<ref name="oecd-dws"/>
* There are tentative signs of a possible convergence of inequality levels towards a common and higher average level across OECD countries.<ref name="oecd-dws"/>
* With very few exceptions ({{wipe|France}}, {{wipe|Japan}}, and {{wipe|Spain}}), the wages of the 10% best-paid workers have risen relative to those of the 10% lowest paid.<ref name="oecd-dws"/>

A 2011 OECD study investigated economic inequality in {{wipe|Argentina}}, {{wipe|Brazil}}, {{wipe|China}}, [[Finance:Income inequality in India|India]], Indonesia, {{wipe|Russia}}, and {{wipe|South Africa}}. It concluded that key sources of inequality in these countries include "a large, persistent [[Finance:Informal sector|informal sector]], widespread regional divides (e.g., [[Earth:Urban–rural political divide|urban-rural]]), gaps in access to education, and barriers to employment and career progression for women."<ref name="oecd-dws"/>
{{multiple image | total_width=450
| image1= Countries by total wealth (trillions USD), Credit Suisse.png |caption1= Countries by total wealth (2022)
| image2= 2018 Inequality-Adjusted Human Development INdex.svg |caption2= Countries by the inequality-adjusted [[Engineering:Human Development Index|Human Development Index]].
}}
A study by the World Institute for Development Economics Research at United Nations University reported that the richest 1% of adults alone owned 40% of global assets in the year 2000. The ''three'' richest people in the world possess more financial assets than the lowest 48 nations combined.<ref>{{cite web|title=Stock quotes, financial tools, news and analysis |work=MSN Money |url=http://articles.moneycentral.msn.com/News/StudyRevealsOverwhelmingWealthGap.aspx |archive-url=https://web.archive.org/web/20110905042236/http://articles.moneycentral.msn.com/News/StudyRevealsOverwhelmingWealthGap.aspx |archive-date=September 5, 2011 |url-status=dead |access-date=July 24, 2010}}</ref> The combined wealth of the "10 million dollar millionaires" grew to nearly $41 trillion in 2008.<ref>[http://www.thaindian.com/newsportal/world-news/growth-of-millionaires-in-india-fastest-in-world_10064367.html "Growth of millionaires in India fastest in world"] {{Webarchive|url=https://web.archive.org/web/20130623172139/http://www.thaindian.com/newsportal/world-news/growth-of-millionaires-in-india-fastest-in-world_10064367.html |date=June 23, 2013 }}. ''Thaindian News''. June 25, 2008.</ref> 

[[Organization:Oxfam|Oxfam]]'s 2021 report on global inequality said that the COVID-19 pandemic has increased economic inequality substantially; the wealthiest people across the globe were impacted the least by the pandemic and their fortunes recovered quickest, with billionaires seeing their wealth increase by $3.9 trillion, while at the same time the number of people living on less than $5.50 a day likely increased by 500 million.<ref>{{cite news |last=Clifford |first=Catherine |date=January 26, 2021 |title=The '1%' are the main drivers of climate change, but it hits the poor the hardest: Oxfam report |work={{wipe|CNBC}} |url=https://www.cnbc.com/2021/01/26/oxfam-report-the-global-wealthy-are-main-drivers-of-climate-change.html |access-date=February 14, 2021}}</ref> According to economist [[Biography:Joseph Stiglitz|Joseph Stiglitz]], the pandemic's "most significant outcome" will be rising economic inequality in the United States and between the developed and developing world.<ref>{{cite news |last=Joseph |first=Stiglitz|date=March 1, 2022 |title=COVID Has Made Global Inequality Much Worse|url=https://www.scientificamerican.com/article/covid-has-made-global-inequality-much-worse/|work=Scientific American |location= |access-date=August 3, 2022}}</ref> The 2024 Oxfam report found a significant increase in inequality as roughly five billion people have become poorer while at the same time the fortunes of the five richest individuals have doubled. The report warns that current trends are paving the way for the world's first trillionaire within a decade and global poverty eradication being postponed for 229 years.<ref>{{cite news |last=Neate|first=Rupert |date=January 14, 2024 |title=World’s five richest men double their money as poorest get poorer|url=https://www.theguardian.com/inequality/2024/jan/15/worlds-five-richest-men-double-their-money-as-poorest-get-poorer|work={{wipe|The Guardian}} |location= |access-date=January 15, 2024}}</ref>

{{ multiple image |total_width=450 |title=Net personal wealth in the U.S. since 1962
| image1= 1962- Net personal wealth - average in percentile ranges - linear scale - US.svg | caption1= The average personal wealth of people in the top 1% is more than a thousand times that of people in bottom 50%.<ref name=WID_through_2021/>
| image2= 1962- Net personal wealth - average in percentile ranges - logarithmic scale - US.svg | caption2= The logarithmic scale shows how wealth has increased for all percentile groups, though moreso for wealthier people.<ref name=WID_through_2021>{{cite web |title=Evolution of wealth indicators, USA, 1913-2019 |url=https://wid.world/country/usa/ |website=WID.world |publisher=World Inequality Database |access-date=September 6, 2023 |archive-url=https://web.archive.org/web/20230705011218/https://wid.world/country/usa/ |archive-date=July 5, 2023 |date=2022 |url-status=live }}</ref>
}}
According to PolitiFact, the top 400 richest Americans "have more wealth than half of all Americans combined."<ref name="PF-20110311">{{cite news |last1=Kertscher |first1=Tom |last2=Borowski |first2=Greg |title=The Truth-O-Meter Says: '''True''' – Michael Moore says 400 Americans have more wealth than half of all Americans combined |url=http://www.politifact.com/wisconsin/statements/2011/mar/10/michael-moore/michael-moore-says-400-americans-have-more-wealth-/ |date=March 10, 2011 |work=PolitiFact |access-date=August 11, 2013 }}</ref><ref name="HP-20110306">{{cite news |last=Moore |first=Michael |title=America Is Not Broke |url=https://www.huffingtonpost.com/michael-moore/america-is-not-broke_b_832006.html |date=March 6, 2011 |work=Huffington Post |access-date=August 11, 2013 }}</ref><ref name="MM-20110307">{{cite web
 | title = The Forbes 400 vs. Everybody Else
 | url = http://www.michaelmoore.com/words/must-read/forbes-400-vs-everybody-else
 | date = March 7, 2011
| work = michaelmoore.com
 | access-date = August 11, 2013
| archive-date = March 9, 2011
| url-status = dead | archive-url = https://web.archive.org/web/20110309211959/http://www.michaelmoore.com/words/must-read/forbes-400-vs-everybody-else
}}</ref><ref name="CNN-20100922">{{cite news |last=Pepitone |first=Julianne |title=Forbes 400: The super-rich get richer |url=https://money.cnn.com/2010/09/22/news/companies/forbes_400/index.htm |date=September 22, 2010 |work=CNN |access-date=August 11, 2013 }}</ref> According to ''{{wipe|The New York Times}}'' on July 22, 2014, the "richest 1 percent in the United States now own more wealth than the bottom 90 percent".<ref name="NYT-20140722">{{cite news |last=Kristof |first=Nicholas |title=An Idiot's Guide to Inequality |url=https://www.nytimes.com/2014/07/24/opinion/nicholas-kristof-idiots-guide-to-inequality-piketty-capital.html |date=July 22, 2014 |work=The New York Times |access-date=July 22, 2014 }}</ref> Inherited wealth may help explain why many Americans who have become rich may have had a "substantial head start".<ref name="Salon-20140324">{{cite web |last=Bruenig |first=Matt |title=You call this a meritocracy? How rich inheritance is poisoning the American economy |url=http://www.salon.com/2014/03/24/death_of_meritocracy_how_inheritance_is_poisoning_the_american_economy/ |date=March 24, 2014 |work=Salon |access-date=August 24, 2014 }}</ref><ref name="ECO-20140318">{{cite news |title=Inequality – Inherited wealth |url=https://www.economist.com/blogs/buttonwood/2014/03/inequality |date=March 18, 2014 |newspaper=[[Finance:The Economist|The Economist]] |access-date=August 24, 2014 }}</ref> A 2017 report by the IPS said that three individuals, [[Biography:Jeff Bezos|Jeff Bezos]], [[Biography:Bill Gates|Bill Gates]] and Warren Buffett, own as much wealth as the bottom half of the population, or 160 million people, and that the growing disparity between the wealthy and the poor has created a "moral crisis", noting that "we have not witnessed such extreme levels of concentrated wealth and power since the first gilded age a century ago."<ref>{{cite news |last= Neate|first=Rupert|date=November 8, 2017 |title=Bill Gates, Jeff Bezos and Warren Buffett are wealthier than poorest half of US|url=https://www.theguardian.com/business/2017/nov/08/bill-gates-jeff-bezos-warren-buffett-wealthier-than-poorest-half-of-us|work=The Guardian |access-date= November 9, 2017}}</ref><ref>{{cite news |last=Taylor|first=Matt |date=November 9, 2017|title=The Paradise Papers Are Just a Glimpse at the Unreal Wealth Gap|url=https://www.vice.com/en_us/article/59yk75/the-paradise-papers-are-just-a-glimpse-at-the-unreal-wealth-gap|work=Vice |access-date=November 10, 2017}}</ref> In 2016, the world's billionaires increased their combined global wealth to a record $6 trillion.<ref>{{cite news |last= Neate|first=Rupert|date=October 26, 2017 |title=World's witnessing a new Gilded Age as billionaires' wealth swells to $6tn|url=https://www.theguardian.com/business/2017/oct/26/worlds-witnessing-a-new-gilded-age-as-billionaires-wealth-swells-to-6tn|work=The Guardian |access-date=October 27, 2017}}</ref> In 2017, they increased their collective wealth to 8.9 trillion.<ref>{{cite news |last=Neate |first=Rupert |date=October 26, 2018 |title=World's billionaires became 20% richer in 2017, report reveals|url=https://www.theguardian.com/news/2018/oct/26/worlds-billionaires-became-20-richer-in-2017-report-reveals|work=The Guardian |access-date=November 5, 2018 }}</ref> In 2018, U.S. income inequality reached the highest level ever recorded by the Census Bureau.<ref>{{cite news |last= Telford|first=Taylor|date=September 26, 2019|title=Income inequality in America is the highest it's been since census started tracking it, data shows|url=https://www.washingtonpost.com/business/2019/09/26/income-inequality-america-highest-its-been-since-census-started-tracking-it-data-show|newspaper={{wipe|The Washington Post}} |access-date=September 30, 2019 }}</ref>

The existing data and estimates suggest a large increase in international (and more generally inter-macroregional) components between 1820 and 1960. It might have slightly decreased since that time at the expense of increasing inequality within countries.<ref name="see for example Novotny 2007">{{cite journal |doi=10.1007/s00168-007-0113-y |title=On the measurement of regional inequality: Does spatial dimension of income inequality matter? |journal=The Annals of Regional Science |volume=41 |issue=3 |pages=563–80 |year=2007 |last1=Novotný |first1=Josef |s2cid=51753883 }}</ref> The [[Organization:United Nations Development Programme|United Nations Development Programme]] in 2014 asserted that greater investments in social security, jobs, and laws that protect vulnerable populations are necessary to prevent widening income inequality.<ref>Mark Anderson (July 24, 2014). [https://www.theguardian.com/global-development/2014/jul/24/jobs-social-security-income-inequality-undp Jobs and social security needed as income inequality widens, UNDP warn]. ''{{wipe|The Guardian}}.'' Retrieved July 24, 2014.</ref>

There is a significant difference in the measured wealth distribution and the public's understanding of wealth distribution. Michael Norton of the Harvard Business School and Dan Ariely of the Department of Psychology at [[Organization:Duke University|Duke University]] found this to be true in their research conducted in 2011. The actual wealth going to the top quintile in 2011 was around 84%, whereas the average amount of wealth that the general public estimated to go to the top quintile was around 58%.<ref>{{cite journal |doi=10.1177/1745691610393524 |pmid=26162108 |title=Building a Better America—One Wealth Quintile at a Time |journal=Perspectives on Psychological Science |volume=6 |issue=1 |pages=9–12 |year=2011 |last1=Norton |first1=Michael I. |last2=Ariely |first2=Dan |s2cid=2013655 }}</ref>

According to a 2020 study, global earnings inequality has decreased substantially since 1970. During the 2000s and 2010s, the share of earnings by the world's poorest half doubled.<ref>{{Cite journal|last1=Hammar |first1=Olle |last2=Waldenström|first2=Daniel|title=Global Earnings Inequality, 1970–2018|journal=The Economic Journal|year=2020|volume=130|issue=632|pages=2526–2545|doi=10.1093/ej/ueaa109|s2cid=157907204|doi-access=free}}</ref> Two researchers claim that global income inequality is decreasing due to strong economic growth in developing countries.<ref>{{cite book|last1=Hellebrandt |first1=Tomáš |last2=Mauro |first2=Paolo |title=The Future of Worldwide Income Distribution |date=2015 |publisher=Peterson Institute for International Economics}}</ref> According to a January 2020 report by the United Nations Department of Economic and Social Affairs, economic inequality between states had declined, but intrastate inequality has increased for 70% of the world population over the period 1990–2015.<ref>{{cite news |author=<!--Staff writer(s); no by-line.--> |date=January 21, 2020 |title=Rising inequality affecting more than two-thirds of the globe, but it's not inevitable: new UN report |url=https://news.un.org/en/story/2020/01/1055681 |work=UN News |access-date=September 6, 2020}}</ref> In 2015, the OECD reported in 2015 that income inequality is higher than it has ever been within OECD member nations and is at increased levels in many emerging economies.<ref>[http://www.oecd.org/newsroom/reducing-gender-gaps-and-poor-job-quality-essential-to-tackle-growing-inequality.htm Improving job quality and reducing gender gaps are essential to tackling growing inequality]. [[Organization:OECD|OECD]], May 21, 2015.</ref> According to a June 2015 report by the [[Organization:International Monetary Fund|International Monetary Fund]] (IMF):

<blockquote>Widening income inequality is the defining challenge of our time. In advanced economies, the gap between the rich and poor is at its highest level in decades. Inequality trends have been more mixed in emerging markets and developing countries (EMDCs), with some countries experiencing declining inequality, but pervasive inequities in access to education, health care, and finance remain.<ref>Era Dabla-Norris; Kalpana Kochhar; Nujin Suphaphiphat; Frantisek Ricka; Evridiki Tsounta (June 15, 2015). [http://www.imf.org/external/pubs/cat/longres.aspx?sk=42986.0 Causes and Consequences of Income Inequality : A Global Perspective]. International Monetary Fund. Retrieved June 16, 2015.</ref></blockquote>

In October 2017, the IMF warned that inequality within nations, in spite of global inequality falling in recent decades, has risen so sharply that it threatens economic growth and could result in further [[Social:Polarization (politics)|political polarization]]. The Fund's Fiscal Monitor report said that "progressive taxation and transfers are key components of efficient fiscal redistribution."<ref>{{cite news |last= Dunsmuir
|first=Lindsay|date=October 11, 2017 |title=IMF calls for fiscal policies that tackle rising inequality|url=https://www.reuters.com/article/imf-g20-inequality/imf-calls-for-fiscal-policies-that-tackle-rising-inequality-idUSL2N1ML16B|work={{wipe|Reuters}} |access-date= October 30, 2017}}</ref>
In October 2018 [[Organization:Oxfam|Oxfam]] published a ''Reducing Inequality Index'' which measured social spending, tax and workers' rights to show which countries were best at closing the gap between the rich and the poor.<ref>{{cite news |last1=Lawson |first1=Max |last2=Martin |first2=Matthew |title=The Commitment to Reducing Inequality Index 2018 |url=https://www.oxfam.org/en/research/commitment-reducing-inequality-index-2018 |access-date=November 13, 2018 |publisher=Oxfam |date=October 9, 2018}}</ref>

The 2022 [[Finance:World Inequality Report|World Inequality Report]], a four-year research project organized by the economists Lucas Chancel, [[Biography:Thomas Piketty|Thomas Piketty]], Emmanuel Saez, and [[Biography:Gabriel Zucman|Gabriel Zucman]], shows that "the world is marked by a very high level of income inequality and an extreme level of wealth inequality" and that these inequalities "seem to be about as great today as they were at the peak of [[Social:Imperialism|western imperialism]] in the early 20th century." According to the report, the bottom half of the population owns 2% of global wealth, while the top 10% owns 76% of it. The top 1% owns 38%.<ref>{{cite news |last1=Kaplan |first1=Juliana |last2= Kiersz |first2=Andy |date=December 7, 2021 |title=A huge study of 20 years of global wealth demolishes the myth of 'trickle-down' and shows the rich are taking most of the gains for themselves |url=https://www.businessinsider.com/how-bad-is-inequality-trickle-down-economics-thomas-piketty-economists-2021-12 |work=Business Insider |location= |access-date=December 8, 2021}}</ref><ref>{{cite news |last=Elliott |first=Larry |date=December 7, 2021 |title=Global inequality 'as marked as it was at peak of western imperialism' |url=https://www.theguardian.com/business/2021/dec/07/global-inequality-western-imperialism-super-rich |work={{wipe|The Guardian}} |location= |access-date=December 8, 2021}}</ref><ref>{{cite web |url=https://wir2022.wid.world/ |title=World Inequality Report 2022 |access-date=December 8, 2021}}</ref>

===Wealth distribution within individual countries===

The wealth is calculated by various factors, for instance: liabilities, [[Finance:Debt|debts]], [[Finance:Exchange rate|exchange rate]]s and their expected development, real estate prices, [[Social:Human resources|human resources]], [[Social:Natural resource|natural resource]]s and technical advancements, etc.

===Income distribution within individual countries===
{{Main|Finance:List of countries by income equality|Finance:Income distribution}}
[[File:GINI index World Bank up to 2018.png|thumb|upright=1.5|Countries' income inequality according to their most recent reported [[Finance:Gini coefficient|Gini index]] values as of 2018.<ref name="auto"/>]]
Income inequality is measured by [[Finance:Gini coefficient|Gini coefficient]] (expressed in percent %) that is a number between 0 and 1. Here 0 expresses perfect equality, meaning that everyone has the same income, whereas 1 represents perfect inequality, meaning that one person has all the income and others have none. A Gini index value above 50% is considered high; countries including Brazil, Colombia, South Africa, Botswana, and Honduras can be found in this category. A Gini index value of 30% or above is considered medium; countries including Vietnam, Mexico, Poland, the United States, Argentina, Russia and Uruguay can be found in this category. A Gini index value lower than 30% is considered low; countries including Austria, Germany, Denmark, Norway, Slovenia, Sweden, and Ukraine can be found in this category.<ref>{{cite web |title=Country Comparison: Distribution of family income – Gini index |website=The World Factbook |publisher=CIA |url=https://www.cia.gov/library/publications/the-world-factbook/rankorder/2172rank.html |access-date=May 8, 2017 |archive-date=June 4, 2011 |archive-url=https://web.archive.org/web/20110604005151/http://www.forbes.com/feeds/afx/2007/06/12/afx3810988.html |url-status=dead}}</ref> In the low-income inequality category (below 30%) is a wide representation of countries previously being part of Soviet Union or its satellites, like Slovakia, Czech Republic, Ukraine and Hungary.

In 2012 the Gini index for income inequality for whole European Union was only 30.6%.

Income distribution can differ from wealth distribution within each country. The wealth inequality is also measured in Gini index. There the higher Gini index signify greater inequality within the wealth distribution in country, 0 means total wealth equality and 1 represents situation, where everyone has no wealth, except an individual that has everything. &nbsp;For instance, countries like Denmark, Norway and Netherlands, all belonging to the last category (below 30%, low-income inequality) also have very high Gini index in wealth distribution, ranging from 70% up to 90%.

===Consumption distribution within individual countries===
{{Main|Consumption distribution}}
In [[Finance:Economics|economics]], the ''consumption distribution'' or ''consumption inequality'' is an alternative to the [[Finance:Income distribution|income distribution]] or wealth distribution for judging economic inequality, comparing levels of [[Finance:Consumption (economics)|consumption]] rather than [[Finance:Income|income]] or wealth.<ref>{{Cite book|url=https://www.oecd-ilibrary.org/economics/framework-for-statistics-on-the-distribution-of-household-income-consumption-and-wealth_9789264194830-en|title=OECD Framework for Statistics on the Distribution of Household Income, Consumption and Wealth|date=February 14, 2013|publisher=Organisation for Economic Co-operation and Development|via=OECD iLibrary}}</ref> This is an important measure of inequality as the basic utility of the wealth or income is the expenditure.<ref>{{cite journal|title=Consumption Inequality |last1=Attanasio |first1=Orazio P. |last2=Pistaferri |first2=Luigi |journal=Journal of Economic Perspectives |volume=30 |issue=2 |date=April 2016 |pages=3–28 |doi=10.1257/jep.30.2.3 |url=https://web.stanford.edu/~pista/JEP.pdf }}</ref> People [[Philosophy:Experience|experience]] the inequality directly in consumption, rather than income or wealth.<ref>{{Cite web|url=https://www.jpmorganchase.com/institute/research/cities-local-communities/insight-consumption-inequality|title=Consumption Inequality: What's in Your Shopping Basket? &#124; JPMorgan Chase Institute|website=www.jpmorganchase.com}}</ref>

==Factors proposed to affect economic inequality{{anchor|Causes}}==
There are various reasons for economic inequality within societies, including both global market functions (such as trade, development, and regulation) as well as social factors (including gender, race, and education).<ref>{{Cite journal|last1=Neckerman|first1=Kathryn M.|last2=Torche|first2=Florencia|date=July 18, 2007|title=Inequality: Causes and Consequences|url=https://www.annualreviews.org/doi/10.1146/annurev.soc.33.040406.131755|journal=Annual Review of Sociology|volume=33|issue=1|pages=335–357|doi=10.1146/annurev.soc.33.040406.131755|issn=0360-0572}}</ref> Recent growth in overall income inequality, at least within the OECD countries, has been driven mostly by increasing inequality in wages and salaries.<ref name="PR divided"/>

Economist [[Biography:Thomas Piketty|Thomas Piketty]] argues that widening economic disparity is an inevitable phenomenon of [[Social:Free market|free market]] [[Philosophy:Capitalism|capitalism]] when the rate of return of capital (r) is greater than the rate of growth of the economy (g).<ref>[[Biography:Thomas Piketty|Piketty, Thomas]] (2014). ''[[Finance:Capital in the Twenty-First Century|Capital in the Twenty-First Century]].'' Belknap Press. {{ISBN|067443000X}} p. 571</ref> According to an IMF report in 2016, after reviewing four decades of neoliberalism, it had warned that certain neoliberal policies including privatization, public spending cuts, and deregulation, have resulted in "increased inequality" and are stunting economic growth globally.<ref>{{Cite web |date=2016-05-27 |title=Neoliberalism is increasing inequality and stunting economic growth, the IMF says |url=https://www.independent.co.uk/news/uk/politics/neoliberalism-is-increasing-inequality-and-stunting-economic-growth-the-imf-says-a7052416.html |access-date=2023-08-20 |website=The Independent |language=en |first1=Jon |last1=Stone }}</ref><ref>{{Cite web |title=Neoliberalism: Oversold? |work=Finance & Development |date=June 2016 |first1=Jonathan D. |last1=Ostry |first2=Prakash |last2=Loungani |first3=Davide |last3=Furceri |url=https://www.imf.org/external/pubs/ft/fandd/2016/06/ostry.htm |access-date=2023-08-20 |publisher=International Monetary Fund}}</ref>

===Labour market===
{{main|Finance:Labour economics|Philosophy:Capitalism|Philosophy:Marxism|Finance:Neoclassical economics}}

In modern [[Finance:Market economy|market economies]], if competition is imperfect; information unevenly distributed; opportunities to acquire education and skills unequal; [[Finance:Market failure|market failure]] results. Many such imperfect conditions exist in virtually every market. According to [[Biography:Joseph Stiglitz|Joseph Stiglitz]] this means that there is an enormous potential role for government to correct such market failures.<ref name="Stiglitz2012"/>

In the United States, real wages are flat over the past 40 years for occupations across income and education levels, e.g., auto mechanics, cashiers, doctors, and software engineers.<ref name=":8">{{Cite journal |last=Kausik |first=B. N. |date=May 3, 2022 |title=Income Inequality, Cause and Cure |url=https://doi.org/10.1080/05775132.2022.2046883 |journal=Challenge |volume=65 |issue=3–4 |pages=93–105 |doi=10.1080/05775132.2022.2046883 |arxiv=2201.10726 |s2cid=246285783 |issn=0577-5132}}</ref> However, stock ownership favors higher income and education levels,<ref>{{Cite web |last1=Parker |first1=Kim |last2=Fry |first2=Richard |title=More than half of U.S. households have some investment in the stock market |website=Pew Research Center |url=https://www.pewresearch.org/fact-tank/2020/03/25/more-than-half-of-u-s-households-have-some-investment-in-the-stock-market/ |access-date=April 21, 2022}}</ref> thereby resulting in disparate investment income.

===Taxes===

Another cause is the rate at which income is taxed coupled with the progressivity of the tax system. A [[Finance:Progressive tax|progressive tax]] is a tax by which the [[Finance:Tax rate|tax rate]] increases as the taxable base amount increases.<ref>[http://www.encyclopedia.com/doc/1B1-375969.html Britannica Concise Encyclopedia]: Tax levied at a rate that increases as the quantity subject to taxation increases.</ref><ref>[http://wordnet.princeton.edu/perl/webwn?s=Progressive+tax Princeton University WordNet]{{dead link|date=September 2017 |bot=InternetArchiveBot |fix-attempted=yes }}: (n) progressive tax (any tax in which the rate increases as the amount subject to taxation increases)</ref> In a progressive tax system, the level of the top tax rate will often have a direct impact on the level of inequality within a society, either increasing it or decreasing it, provided that income does not change as a result of the change in tax regime. Additionally, steeper tax progressivity applied to social spending can result in a [[Philosophy:Redistribution of income and wealth|more equal distribution of income]] across the board.<ref>{{cite journal|last=Alesina|first=Alberto|author2=Dani Rodrick|title=Distributive Politics and Economic Growth|journal=Quarterly Journal of Economics|date=May 1994|volume=109|issue=2|pages=465–90 |doi=10.2307/2118470|jstor=2118470|url=http://nrs.harvard.edu/urn-3:HUL.InstRepos:4551798}}</ref> Tax credits such as the Earned Income Tax Credit in the US can also decrease income inequality.<ref>{{cite journal |last1=Hatch |first1=Megan E. |last2=Rigby |first2=Elizabeth |title=Laboratories of (In)equality? Redistributive Policy and Income Inequality in the American States |journal=Policy Studies Journal |date=2015 |volume=43 |issue=2 |pages=163–187 |doi=10.1111/psj.12094}}</ref> The difference between the Gini index for an income distribution before taxation and the Gini index after taxation is an indicator for the effects of such taxation.<ref>{{cite journal|title=More than a Dozen Alternative Ways of Spelling Gini|author=Shlomo Yitzhaki|journal=Economic Inequality|volume=8|year=1998|pages=13–30 |url=http://siteresources.worldbank.org/INTDECINEQ/Resources/morethan2002.pdf}}</ref>

===Education===
{{multiple image | total_width=450
| image1=20230810 Ivy-Plus admission rates vs parent income percentile.svg |caption1=Ivy-Plus university admissions rates vary with the income of the students' parents, with the acceptance rate of the top 0.1% income percentile being almost twice as much as other students.<ref name=OpportunityInsights_202307>{{cite web |last1=Chetty |first1=Raj |last2=Deming |first2=David J. |last3=Friedman |first3=John N. |title=Diversifying Society's Leaders? The Determinants and Consequences of Admission to Highly Selective Colleges |page=2 |url=https://opportunityinsights.org/wp-content/uploads/2023/07/CollegeAdmissions_Nontech.pdf |publisher=Opportunity Insights |archive-url=https://web.archive.org/web/20230731024342/https://opportunityinsights.org/wp-content/uploads/2023/07/CollegeAdmissions_Nontech.pdf |archive-date=July 31, 2023 |date=July 2023 |url-status=live}} Figure 3. "Ivy-Plus" refers to Ivy League schools plus others with similar prestige, rankings or selectivity.</ref>
| image2=Going up or down advertisement.jpg |caption2=A 1916 ad for a vocational school appealed to Americans' belief in the possibility of self-betterment, as well as threatening economic insecurity through lack of education and the consequences of downward mobility in the income inequality during the [[History:Industrial Revolution|Industrial Revolution]]
}}
An important factor in the creation of inequality is variation in individuals' access to education.<ref name="becker">{{cite web|url=http://www.american.com/archive/2007/may-june-magazine-contents/the-upside-of-income-inequality|title=The Upside of Income Inequality|last=Becker|first=Gary S.|date=May 2007|publisher=The America|author2=Murphy, Kevin M.|access-date=January 8, 2014|archive-url=https://web.archive.org/web/20140102212816/http://www.american.com/archive/2007/may-june-magazine-contents/the-upside-of-income-inequality/|archive-date=January 2, 2014|url-status=dead}}</ref> Education, especially in an area where there is a high demand for workers, creates high wages for those with this education.<ref>{{Cite report |first1= Barry |last1= Bosworth |first2= Gary |last2= Burtless |first3= C. Eugene |last3= Steuerle |date= December 1999 |title= Lifetime Earnings Patterns, the Distribution of Future Social Security Benefits, and the Impact of Pension Reform |type= report no. CRR WP 1999-06 |publisher= Center for Retirement Research at Boston College |location= Chestnut Hill, MA |url= http://urban.org/uploadedpdf/412137-lifetime-earnings.pdf |page= 43 |access-date= October 1, 2012 |archive-date= July 19, 2010 |archive-url= https://web.archive.org/web/20100719054205/http://www.urban.org/UploadedPDF/412137-lifetime-earnings.pdf |url-status= dead }}</ref> However, increases in education first increase and then decrease growth as well as income inequality. As a result, those who are unable to afford an education, or choose not to pursue optional education, generally receive much lower wages. The justification for this is that a lack of education leads directly to lower incomes, and thus lower aggregate saving and investment. Conversely, quality education raises incomes and promotes growth because it helps to unleash the productive potential of the poor.<ref>{{Cite journal |last=Shealy |first=Craig N. |date=November 1, 2009 |title=An Interview With Education for Sustainable Development "Young Voices": Beliefs and Values From the Next Generation of ESD Leaders |url=http://dx.doi.org/10.1891/1942-0617.1.2.135 |journal=Beliefs and Values |volume=1 |issue=2 |pages=135–141 |doi=10.1891/1942-0617.1.2.135 |issn=1942-0617}}</ref>

Access to education was in turn influenced by land inequalities. In the less industrialized parts of 19th century Europe, for example, landowners still held more political power than industrialists. These landowners did not benefit from educating their workers as much as industrialists did, since "educated workers have more incentives to migrate to urban, industrial areas than their less educated counterparts."<ref name=":7">{{Cite journal|last1=Baten|first1=Jörg|last2=Hippe|first2=Ralph|date=2017|title=Geography, land inequality and regional numeracy in Europe in historical perspective|journal=Journal of Economic Growth}}</ref> Consequently, lower incentives to promote education in regions where land inequality was high led to lower levels of [[Numeracy|numeracy]] in these regions.<ref name=":7" />

===Economic liberalism, deregulation and decline of unions===

John Schmitt and Ben Zipperer (2006) of the CEPR point to [[Social:Economic liberalism|economic liberalism]] and the reduction of business [[Finance:Regulation|regulation]] along with the decline of union membership as one of the causes of economic inequality. In an analysis of the effects of intensive Anglo-American liberal policies in comparison to continental European liberalism, where unions have remained strong, they concluded "The U.S. economic and social model is associated with substantial levels of social exclusion, including high levels of income inequality, high relative and absolute poverty rates, poor and unequal educational outcomes, poor health outcomes, and high rates of crime and incarceration. At the same time, the available evidence provides little support for the view that U.S.-style [[Finance:Labour market flexibility|labor market flexibility]] dramatically improves labor-market outcomes. Despite popular prejudices to the contrary, the U.S. economy consistently affords a lower level of economic mobility than all the continental European countries for which data is available."<ref>Schmitt, John and Ben Zipperer. 2006. "[http://www.cepr.net/documents/social_exclusion_2006_08.pdf Is the U.S. a Good Model for Reducing Social Exclusion in Europe?]" CEPR</ref>

More recently, the [[Organization:International Monetary Fund|International Monetary Fund]] has published studies which found that the decline of unionization in many advanced economies and the establishment of [[Social:Neoliberalism|neoliberal]] economics have fueled rising income inequality.<ref>Michael Hiltzik (March 25, 2015). [https://www.latimes.com/business/hiltzik/la-fi-mh-imf-agrees-loss-of-union-power-20150325-column.html IMF agrees: Decline of union power has increased income inequality]. ''{{wipe|Los Angeles Times}}.'' Retrieved March 26, 2015.</ref><ref>[http://www.businessinsider.com/imf-neoliberalism-warnings-2016-5 IMF: The last generation of economic policies may have been a complete failure]. ''Business Insider.'' May 2016.</ref>

Contrary to the proponents of neoliberalism, [[Social:Trickle-down economics|trickle-down economics]] have been proven to not be effective in resolving economic inequalities but have instead worsened it.<ref>{{Cite web |last=Srikanth |first=Anagha |date=2020-12-17 |title=Huge new study shows trickle-down economics makes inequality worse, researchers say |url=https://thehill.com/changing-america/respect/poverty/530731-huge-new-study-shows-trickle-down-economics-makes-inequality/ |access-date=2023-08-20 |website=The Hill |language=en-US}}</ref>

=== Technology ===
The growth in importance of [[Engineering:Information technology|information technology]] has been credited with increasing income inequality.<ref name="Basu-2016">{{cite web|last1=Basu|first1=Kaushik|title=Is technology making inequality worse?|url=https://www.weforum.org/agenda/2016/01/is-technology-making-inequality-worse/|website=World Economic Forum|access-date=November 17, 2017|date=January 6, 2016}}</ref> Technology has been called "the main driver of the recent increases in inequality" by Erik Brynjolfsson, of MIT.<ref name="Rotman-2014">{{cite journal|last1=Rotman|first1=David|title=Technology and Inequality|journal=MIT Technology Review|date=October 21, 2014|url=https://www.technologyreview.com/s/531726/technology-and-inequality/|access-date=November 17, 2017}}</ref> In arguing against this explanation, Jonathan Rothwell notes that if technological advancement is measured by high rates of invention, there is a negative correlation between it and inequality. Countries with high invention rates — "as measured by patent applications filed under the Patent Cooperation Treaty" — exhibit lower inequality than those with less. In one country, the United States, "salaries of engineers and software developers rarely reach" above $390,000/year (the lower limit for the top 1% earners).<ref name="NYT-17-11-2017">{{cite news|last1=Rothwell|first1=Jonathan|title=Myths of the 1 Percent: What's Putting People at the Top|newspaper=The New York Times |url=https://www.nytimes.com/2017/11/17/upshot/income-inequality-united-states.html?action=click&module=MoreInSection&pgtype=Article&region=Footer&contentCollection=The%20Upshot|access-date=November 17, 2017|agency=The New York Times|date=November 17, 2017}}</ref>

Some researchers, such as Juliet B. Schor, highlight the role of for-profit online sharing economy platforms as an accelerator of income inequality and calls into question their supposed contribution in empowering outsiders of the labour market.<ref>{{Cite journal|last=Schor|first=Juliet B.|date=February 10, 2017|title=Does the sharing economy increase inequality within the eighty percent?: findings from a qualitative study of platform providers|journal=Cambridge Journal of Regions, Economy and Society|volume=10|issue=2|pages=263–279|doi=10.1093/cjres/rsw047|issn=1752-1378|doi-access=free}}</ref>

Taking the example of TaskRabbit, a labour service platform, she shows that a large proportion of providers already have a stable full-time job and participate part-time in the platform as an opportunity to increase their income by diversifying their activities outside employment, which tends to restrict the volume of work remaining for the minority of platform workers.

In addition, there is an important phenomenon of labour substitution as manual tasks traditionally performed by workers without a degree (or just a college degree) integrated into the labour market in the traditional economy sectors are now performed by workers with a high level of education (in 2013, 70% of TaskRabbit's workforce held a bachelor's degree, 20% a master's degree and 5% a PhD).<ref>{{Cite web|last=Newton|first=Casey|date=May 23, 2013 |title=Temping fate: can TaskRabbit go from side gigs to real jobs?|url=https://www.theverge.com/2013/5/23/4352116/taskrabbit-temp-agency-gig-economy|access-date=April 30, 2021|website=The Verge}}</ref> The development of platforms, which are increasingly capturing demand for these manual services at the expense of non-platform companies, may therefore benefit mainly skilled workers who are offered more earning opportunities that can be used as supplemental or transitional work during periods of unemployment.

It has also been proposed that information technologies contribute to "winner take most" market concentration, reducing the need for labor across competing suppliers.<ref>{{Cite journal |last1=Autor |first1=David |last2=Dorn |first2=David |last3=Katz |first3=Lawrence F |last4=Patterson |first4=Christina |last5=Van Reenen |first5=John |date=May 1, 2020 |title=The Fall of the Labor Share and the Rise of Superstar Firms* |journal=The Quarterly Journal of Economics |volume=135 |issue=2 |pages=645–709 |doi=10.1093/qje/qjaa004 |issn=0033-5533}}</ref> Market concentration drives down labor's share of the GDP, increasing the wealth of capital and thereby exacerbating inequality.

==== Automation ====
Economists have linked [[Engineering:Automation|automation]] to increases in economic inequality, as automation raises the returns to wealth and contributes to stagnating wages at the lower end of the wage distribution.<ref>{{Cite journal |last1=Moll |first1=Benjamin |last2=Rachel |first2=Lukasz |last3=Restrepo |first3=Pascual |date=2022 |title=Uneven Growth: Automation's Impact on Income and Wealth Inequality |url=https://www.econometricsociety.org/doi/10.3982/ECTA19417 |journal=Econometrica |language=en |volume=90 |issue=6 |pages=2645–2683 |doi=10.3982/ECTA19417 |issn=0012-9682}}</ref> Several economists have suggested that automation has increased income inequality by causing low skill jobs to be replaced with machines operated by technologically skilled workers, thereby reducing the demand for unskilled labor while increasing the demand for skilled labor.{{ r | Peterson_2017 | p=1 | q=Many explanations for the current increases in economic inequality have been offered. Autor (2014), Milanovic (2016), Atkinson (2015) and Deaton (2013) all point to skills-biased technological change as a major cause. Technological innovations in recent years have often led to the replacement of unskilled workers with computerized machines that require highly skilled operators. The result is that demand for skilled workers has increased driving up their wages while the opposite effect occurs for unskilled workers increasing the disparities in labor income. Skills depend on education so wage inequalities may also reflect differences in educational opportunities. }}

===Globalization===
{{main|Social:Globalization|Finance:International inequality}}

[[File:Global changes in real income by income percentile - v1.png|thumb|right|upright=1.5|"Elephant curve": Change in real income between 1988 and 2008 at various income percentiles of global income distribution.<ref name="heymancenter.org">{{Cite web|url=https://sofheyman.org/|title=SOF/Heyman &#124; The Society of Fellows and Heyman Center for the Humanities|website=SOF/Heyman}}</ref>]]{{Anchor|Elephant curve|Elephant chart}}
[[Social:Free trade|Trade liberalization]] may shift economic inequality from a global to a domestic scale.<ref name=econ190408>
{{cite news
| title     = Economic Focus
| newspaper      = [[Finance:The Economist|The Economist]]
| location  = London
| page      = 81
| date      = April 19, 2008
}}
</ref> When rich countries trade with poor countries, the low-skilled workers in the rich countries may see reduced wages as a result of the competition, while low-skilled workers in the poor countries may see increased wages. Trade economist Paul Krugman estimates that trade liberalisation has had a measurable effect on the rising inequality in the United States. He attributes this trend to increased trade with poor countries and the fragmentation of the [[Social:Means of production|means of production]], resulting in low skilled jobs becoming more tradeable.<ref>{{Cite web |work=Economic Issues |series=11 |title=Does Globalization Lower Wages and Export Jobs? |url=https://www.imf.org/external/pubs/ft/issues11/ |access-date=June 18, 2022 |publisher=International Monetary Fund |language=en-US |date= September 1997 |first1= Matthew J. |last1=Slaughter |first2=Phillip |last2=Swagel }}</ref>

Anthropologist Jason Hickel contends that globalization and "[[Finance:Structural adjustment|structural adjustment]]" set off the "[[Finance:Race to the bottom|race to the bottom]]", a significant driver of surging global inequality. Another driver Hickel mentions is the [[Finance:Debt|debt]] system which advanced the need for structural adjustment in the first place.<ref>{{cite book |last= Hickel|first=Jason|date=2018 |title=The Divide: A Brief Guide to Global Inequality and its Solutions|publisher=Windmill Books|pages=175–176 |isbn=978-1786090034}}</ref>

===Gender===

[[File:OECD gender wage gap.svg|thumb|upright=1.5|The gender gap in median earnings of full-time employees according to the OECD 2015<ref>OECD. [http://www.oecd.org/dataoecd/54/57/40846335.pdf ''OECD Employment Outlook 2008 – Statistical Annex''] {{webarchive |url=https://web.archive.org/web/20081206221033/http://www.oecd.org/dataoecd/54/57/40846335.pdf |date=December 6, 2008 }}. OECD, Paris, 2008, p. 358.</ref>]]
In many countries, there is a [[Social:Gender pay gap|gender pay gap]] in favor of males in the labor market. Several factors other than discrimination contribute to this gap. On average, women are more likely than men to consider factors other than pay when looking for work and may be less willing to travel or relocate.<ref name="Forbes 2006">{{cite news |work=Forbes |title=Are Women Earning More Than Men? |date=May 12, 2006 |url=https://www.forbes.com/ceonetwork/2006/05/12/women-wage-gap-cx_wf_0512earningmore.html |archive-url=https://web.archive.org/web/20081210154124/http://www.forbes.com/ceonetwork/2006/05/12/women-wage-gap-cx_wf_0512earningmore.html |url-status=dead |archive-date=December 10, 2008}}</ref><ref>{{cite news| url=https://www.washingtonpost.com/wp-dyn/content/article/2007/04/02/AR2007040201262.html | newspaper=The Washington Post | title=A Bargain At 77 Cents To a Dollar | first=Carrie | last=Lukas | date=April 3, 2007 | access-date=May 3, 2010}}</ref> [[Biography:Thomas Sowell|Thomas Sowell]], in his book ''[[Finance:Knowledge and Decisions|Knowledge and Decisions]]'', claims that this difference is due to women not taking jobs due to marriage or pregnancy. A U.S. Census's report stated that in US once other factors are accounted for there is still a difference in earnings between women and men.<ref>{{cite web |title=Evidence From Census 2000 About Earnings by Detailed Occupation for Men and Women | last=Weinberg | first=Daniel H | url=https://www.census.gov/prod/2004pubs/censr-15.pdf |date= May 2004 |access-date=February 21, 2017}}</ref> A study done on three post-soviet countries [[Place:Armenia|Armenia]], [[Place:Georgia (country)|Georgia]], and [[Place:Azerbaijan|Azerbaijan]] reveals that gender is one of the driving forces of income inequality, and being female has a significant negative effect on income when other factors are held equal. The results show more than 50% gender pay gap in all three countries.<ref>{{cite journal |last=Habibov |first=Nazim |date=2012 |title=Income inequality and its driving forces in transitional countries: evidence from Armenia, Azerbaijan and Georgia |url=https://www.researchgate.net/publication/271672769 |journal=Journal of Comparative Social Welfare |volume=28 |issue=3 |pages=209–211 |doi=10.1080/17486831.2012.749504 |s2cid=153681101 |access-date=}}</ref> These findings are because usually employers tend to avoid hiring women because of possible maternity leave. Other reason for this can be [[Social:Occupational segregation|occupational segregation]], which implies that women are usually accumulated in lower-paid positions and sectors, such as social services and education.

=== Race ===

As a general rule, races which have been historically and systematically colonized (typically indigenous ethnicities) continue to experience lower levels of financial stability in the present day. The [[Finance:Global South|global South]] is considered to be particularly victimized by this phenomenon, though the exact socioeconomic manifestations change across different regions.<ref name=":3" />

==== Westernized Nations ====
While the progression of civil rights movements and justice reform has improved access to education and other economic opportunities in politically advanced nations, racial income and wealth disparity still exists.<ref>{{Cite journal|last1=Bloome|first1=D.|last2=Western|first2=B.|date=December 1, 2011 |title=Cohort Change and Racial Differences in Educational and Income Mobility|journal=Social Forces |volume=90|issue=2|pages=375–395|doi=10.1093/sf/sor002|s2cid=16514651|issn=0037-7732}}</ref> In the United States for example, a survey{{when|date=April 2021}} of African American populations show that they are more likely to drop out of high school and college, are typically employed for fewer hours at lower wages, have lower than average intergenerational wealth, and are more likely to use welfare as young adults than their white counterparts.<ref>{{Cite journal|last1=Herring|first1=Cedric|last2=Conley|first2=Dalton |date=March 2000|title=Being Black, Living in the Red: Race, Wealth, and Social Policy in America |journal=Contemporary Sociology|volume=29|issue=2|pages=349|doi=10.2307/2654395|jstor=2654395|issn=0094-3061}}</ref>

Mexican-Americans, while suffering less debilitating socioeconomic factors than black Americans, experience deficiencies in the same areas when compared to whites and have not assimilated financially to the level of stability experienced by white Americans as a whole.<ref>{{Cite journal|last=Vallejo|first=Jody Agius |date=December 2010|title=Generations of exclusion: Mexican Americans, assimilation and race|journal=Latino Studies|volume=8|issue=4 |pages=572–574|doi=10.1057/lst.2010.45|s2cid=143814091|issn=1476-3435}}</ref> These experiences are the effects of the measured disparity due to race in countries like the US, where studies show that in comparison to whites, blacks suffer from drastically lower levels of upward [[Finance:Economic mobility|mobility]], higher levels of downward mobility, and poverty that is more easily transmitted to offspring as a result of the disadvantage stemming from the era of slavery and post-slavery racism that has been passed through racial generations to the present.<ref name=":4">{{Cite journal|last1=Bowles |first1=Samuel|last2=Gintis|first2=Herbert|date=August 1, 2002|title=The Inheritance of Inequality |journal=Journal of Economic Perspectives|volume=16|issue=3|pages=3–30|doi=10.1257/089533002760278686 |issn=0895-3309|doi-access=free}}</ref><ref>{{Cite journal|last1=Bhattacharya|first1=Debopam|last2=Mazumder |first2=Bhashkar|date=2010|title=A Nonparametric Analysis of Black-White Differences in Intergenerational Income Mobility in the United States|journal=Quantitative Economics|volume=2|issue=3|pages=335–379 |doi=10.2139/ssrn.1066819 |hdl=10419/150324|s2cid=55109224|issn=1556-5068|hdl-access=free}}</ref><ref>{{Citation|last=Hertz|first=Tom|editor1-first=Samuel|editor1-last=Bowles|editor2-first=Herbert|editor2-last=Gintis|editor3-first=Melissa|editor3-last=Osborne Groves|title=Chapter Five. Rags, Riches, and Race The Intergenerational Economic Mobility of Black and White Families in the United States|date=December 31, 2009|work=Unequal Chances|pages=165–191|place=Princeton |publisher=Princeton University Press |doi=10.1515/9781400835492.165|isbn=978-1400835492}}</ref> These are lasting financial inequalities that apply in varying magnitudes to most non-white populations in nations such as the US, the UK, France, Spain, Australia, etc.<ref name=":3" />

==== Latin America ====
In the countries of the Caribbean, Central America, and South America, many ethnicities continue to deal with the effects of European colonization, and in general nonwhites tend to be noticeably poorer than whites in this region. In many countries with significant populations of indigenous races and those of Afro-descent (such as Mexico, Colombia, Chile, etc.) income levels can be roughly half as high as those experiences by white demographics, and this inequity is accompanied by systematically unequal access to education, career opportunities, and poverty relief. This region of the world, apart from urbanizing areas like Brazil and Costa Rica, continues to be understudied and often the racial disparity is denied by Latin Americans who consider themselves to be living in post-racial and post-colonial societies far removed from intense social and economic stratification despite the evidence to the contrary.<ref>{{Cite book|last1=de Ferranti|first1=David|last2=Perry|first2=Guillermo E.|last3=Ferreira|first3=Francisco|last4=Walton |first4=Michael|year=2004|title=Inequality in Latin America|doi=10.1596/0-8213-5665-8|isbn=978-0821356654}}</ref>

==== Africa ====
African countries, too, continue to deal with the effects of the [[History:Atlantic slave trade|Trans-Atlantic Slave Trade]], which set back economic development as a whole for blacks of African citizenship more than any other region. The degree to which colonizers stratified their holdings on the continent on the basis of race has had a direct correlation in the magnitude of disparity experienced by nonwhites in the nations that eventually rose from their colonial status. Former French colonies, for example, see much higher rates of income inequality between whites and nonwhites as a result of the rigid hierarchy imposed by the French who lived in Africa at the time.<ref>{{Cite journal |last1=Bossuroy|first1=Thomas|last2=Cogneau |first2=Denis|date=April 18, 2013|title=Social Mobility in Five African Countries|journal=Review of Income and Wealth|volume=59|pages=S84–S110|doi=10.1111/roiw.12037|s2cid=154317227 |hdl=10.1111/roiw.12037|hdl-access=free|issn=0034-6586}}</ref> Another example is found in South Africa, which, still reeling from the socioeconomic impacts of Apartheid, experiences some of the highest racial income and wealth inequality in all of Africa.<ref name=":4" /> In these and other countries like Nigeria, Zimbabwe, and Sierra Leone, movements of civil reform have initially led to improved access to financial advancement opportunities, but data{{when|date=April 2021}} shows that for nonwhites this progress is either stalling or erasing itself in the newest generation of blacks that seek education and improved transgenerational wealth. The economic status of one's parents continues to define and predict the financial futures of African and minority ethnic groups.<ref>{{Cite journal|last=Peil|first=Margaret|date=January 1990|title=Intergenerational mobility through education: Nigeria, Sierra Leone and Zimbabwe|journal=International Journal of Educational Development|volume=10|issue=4|pages=311–325|doi=10.1016/s0738-0593(09)90008-6|issn=0738-0593}}</ref>{{needs update|date=April 2021}}

==== Asia ====
Asian regions and countries such as China, the Middle East, and Central Asia have been vastly understudied in terms of racial disparity, but even here the effects of Western colonization provide similar results to those found in other parts of the globe.<ref name=":3" /> Additionally, cultural and historical practices such as the caste system in India leave their marks as well. While the disparity is greatly improving in the case of India, there still exists social stratification between peoples of lighter and darker skin tones that cumulatively result in income and wealth inequality, manifesting in many of the same poverty traps seen elsewhere.<ref>{{Cite journal|last1=Hnatkovska|first1=Viktoria |last2=Lahiri|first2=Amartya|last3=Paul|first3=Sourabh B.|date=2013|title=Breaking the Caste Barrier: Intergenerational Mobility in India|journal=Journal of Human Resources|volume=48|issue=2 |pages=435–473 |doi=10.1353/jhr.2013.0012|s2cid=13341683|issn=1548-8004}}</ref>

=== Economic development ===
[[File:Kuznets curve.png|right|upright=1.5|thumb|A Kuznets curve]]

{{Main|Finance:Kuznets curve}}
Economist [[Biography:Simon Kuznets|Simon Kuznets]] argued that levels of economic inequality are in large part the result of stages of [[Finance:Economic development|development]]. According to Kuznets, countries with low levels of development have relatively equal distributions of wealth. As a country develops, it acquires more capital, which leads to the owners of this capital having more wealth and income and introducing inequality. Eventually, through various possible redistribution mechanisms such as social welfare programs, more developed countries move back to lower levels of inequality.<ref>{{Cite journal |last1=Korpi |first1=Walter |last2=Palme |first2=Joakim |date=1998 |title=The Paradox of Redistribution and Strategies of Equality: Welfare State Institutions, Inequality, and Poverty in the Western Countries |url=https://www.jstor.org/stable/2657333 |journal=American Sociological Review |volume=63 |issue=5 |pages=661–687 |doi=10.2307/2657333 |jstor=2657333 |issn=0003-1224}}</ref>

===Wealth concentration===
Wealth concentration is the process by which, under certain conditions, newly created wealth concentrates in the possession of already-wealthy individuals or entities. Accordingly, those who already hold wealth have the means to invest in new sources of creating wealth or to otherwise leverage the accumulation of wealth, and thus they are the beneficiaries of the new wealth. Over time, wealth concentration can significantly contribute to the persistence of inequality within society. [[Biography:Thomas Piketty|Thomas Piketty]] in his book ''[[Finance:Capital in the Twenty-First Century|Capital in the Twenty-First Century]]'' argues that the fundamental force for divergence is the usually greater return of capital (r) than economic growth (g), and that larger fortunes generate higher returns.<ref>pp.&nbsp;384 Table 12.2, ''U.S. university endowment size vs. real annual rate of return''</ref>

===Rent seeking===
{{main|Social:Rent-seeking}}
Economist [[Biography:Joseph Stiglitz|Joseph Stiglitz]] argues that rather than explaining concentrations of wealth and income, market forces should serve as a brake on such concentration, which may better be explained by the non-market force known as "[[Social:Rent-seeking|rent-seeking]]". While the market will bid up compensation for rare and desired skills to reward wealth creation, greater productivity, etc., it will also prevent successful entrepreneurs from earning excess profits by fostering competition to cut prices, profits and large compensation.<ref name="stiglitz.p35">Stiglitz, Joseph E. (June 4, 2012). The Price of Inequality: How Today's Divided Society Endangers Our Future (pp. 30–1, 35–6). Norton. Kindle Edition.</ref> A better explainer of growing inequality, according to Stiglitz, is the use of political power generated by wealth by certain groups to shape government policies financially beneficial to them. This process, known to economists as rent-seeking, brings income not from creation of wealth but from "grabbing a larger share of the wealth that would otherwise have been produced without their effort".<ref name="stiglitz.p32">Stiglitz, Joseph E. (June 4, 2012). The Price of Inequality: How Today's Divided Society Endangers Our Future (p. 32). Norton. Kindle Edition.</ref>

===Finance industry===
Jamie Galbraith argues that countries with larger financial sectors have greater inequality, and the link is not an accident.<ref>James K. Galbraith, ''[https://books.google.com/books?id=CEFpAgAAQBAJ&dq=%22Inequality+and+Instability%3A+A+Study+of+the+World+Economy+Just+before+the+Great+Crisis%22&pg=PP1 Inequality and Instability: A Study of the World Economy Just before the Great Crisis]'' (New York: Oxford University Press, 2012).</ref><ref>Stiglitz, Joseph E. (June 4, 2012). ''The Price of Inequality: How Today's Divided Society Endangers Our Future'', p. 334. Norton. Kindle Edition.</ref>{{why|date=July 2019}}

===Global warming and climate change===
{{multiple image |total_width=450
| image1=2021 Carbon dioxide (CO2) emissions per person versus GDP per person - scatter plot.svg |caption1=Scaling the effect of wealth to the national level: richer [[Finance:Developed country|(developed)]] countries emit more {{CO2}} per person than poorer [[Finance:Developing country|(developing)]] countries.<ref name=WashPost_20230301>{{cite news |last1=Stevens |first1=Harry |title=The United States has caused the most global warming. When will China pass it? |url=https://www.washingtonpost.com/climate-environment/interactive/2023/global-warming-carbon-emissions-china-us/ |newspaper=The Washington Post |date=1 March 2023 |archive-url=https://web.archive.org/web/20230301130719/https://www.washingtonpost.com/climate-environment/interactive/2023/global-warming-carbon-emissions-china-us/ |archive-date=1 March 2023 |url-status=live }}</ref> Emissions are roughly proportional to [[Finance:Gross domestic product|GDP]] per person, though the rate of increase diminishes with average GDP/pp of about $10,000.
| image2=2021 CO2 emissions by income decile - International Energy Agency IEA.svg |caption2=Though total {{CO2}} emissions (size of pie charts) differ substantially among high-emitting regions, the pattern of higher income classes emitting more than lower income classes is consistent across regions.<ref name=IEA_20230222/> The world’s top 1% of emitters emit over 1000 times more than the bottom 1%.<ref name=IEA_20230222>{{cite web |last1=Cozzi |first1=Laura |last2=Chen |first2=Olivia |last3=Kim |first3=Hyeji |title=The world's top 1% of emitters produce over 1000 times more CO2 than the bottom 1% |url=https://www.iea.org/commentaries/the-world-s-top-1-of-emitters-produce-over-1000-times-more-co2-than-the-bottom-1 |website=iea.org |publisher=International Energy Agency (IEA) |archive-url=https://web.archive.org/web/20230303032020/https://www.iea.org/commentaries/the-world-s-top-1-of-emitters-produce-over-1000-times-more-co2-than-the-bottom-1 |archive-date=3 March 2023 |date=22 February 2023 |url-status=live }} "Methodological note: ... The analysis accounts for energy-related CO2, and not other greenhouse gases, nor those related to land use and agriculture."</ref>
}}
A 2019 study published in ''PNAS'' found that [[Earth:Global warming|global warming]] plays a role in increasing economic inequality between countries, boosting economic growth in developed countries while hampering such growth in developing nations of the [[Finance:Global South|Global South]]. The study says that 25% of gap between the developed world and the developing world can be attributed to global warming.<ref>{{cite news |last= Uchoa|first=Pablo|date=May 6, 2019 |title=How global warming has made the rich richer |url=http://www.bbc.com/capital/story/20190502-how-global-warming-has-made-the-rich-richer|work=BBC |access-date=June 5, 2019 }}</ref>

A 2020 report by [[Organization:Oxfam|Oxfam]] and the [[Organization:Stockholm Environment Institute|Stockholm Environment Institute]] says that the wealthiest 10% of the global population were responsible for more than half of global carbon dioxide emissions from 1990 to 2015, which increased by 60%.<ref>{{cite news |last=Harvey |first=Fiona |date=September 20, 2020 |title=World's richest 1% cause double CO2 emissions of poorest 50%, says Oxfam |url=https://www.theguardian.com/environment/2020/sep/21/worlds-richest-1-cause-double-co2-emissions-of-poorest-50-says-oxfam |work={{wipe|The Guardian}} |access-date=September 22, 2020}}</ref> According to a 2020 report by the UNEP, overconsumption by the rich is a significant driver of the [[Earth:Climate crisis|climate crisis]], and the wealthiest 1% of the world's population are responsible for more than double the greenhouse gas emissions of the poorest 50% combined. Inger Andersen, in the foreword to the report, said "this elite will need to reduce their footprint by a factor of 30 to stay in line with the Paris Agreement targets."<ref>{{cite news |last= McGrath |first=Matt |date=December 10, 2020 |title=Climate change: Global 'elite' will need to slash high-carbon lifestyles|url=https://www.bbc.com/news/science-environment-55229725 |work=BBC |access-date=December 11, 2020}}</ref> A 2022 report by Oxfam found that the business investments of the wealthiest 125 billionaires emit 393 million metric tonnes of greenhouse gas emissions annually.<ref>{{cite news |last=Ward-Glenton|first=Hannah|date=November 8, 2022 |title=Billionaires emit a million times more greenhouse gases than the average person: Oxfam|url=https://www.cnbc.com/2022/11/08/billionaires-emit-a-million-times-more-greenhouse-gases-than-the-average-person-oxfam.html|work=CNBC |location= |access-date=November 8, 2022}}</ref>

In July 2023, a letter sent to the United Nations secretary general António Guterres and World Bank president Ajay Banga by a group of over 200 economists from 67 countries, including Jayati Ghosh, [[Biography:Joseph Stiglitz|Joseph Stiglitz]] and Thomas Piketty, warned that if the sharp increase in economic inequality is not reversed, it will "entrench poverty and increase the risk of climate breakdown."<ref>{{cite news |last= Elliott|first=Larry|date= |title=Top economists call for action on runaway global inequality|url=https://www.theguardian.com/inequality/2023/jul/17/top-economists-call-for-action-global-inequality-rich-poor-poverty-climate-breakdown-un-world-bank|work=The Guardian |location= |access-date=July 19, 2023}}</ref>

===Politics===
[[Biography:Joseph Stiglitz|Joseph Stiglitz]] argues in ''The Price of Inequality'' (2012) that the economic inequality is inevitable and permanent, because it is caused by the great amount of political power the richest have.<ref name="Stiglitz2012">{{cite book |last=Stiglitz |first=Joseph E. |date=June 4, 2012 |title=The Price of Inequality: How Today's Divided Society Endangers Our Future |page=34 |publisher=Norton |isbn=9780393088694 |edition=Kindle |url=https://archive.org/details/priceofinequalit00stig}}</ref> He wrote, "While there may be underlying economic forces at play, politics have shaped the market, and shaped it in ways that advantage the top at the expense of the rest."

===Cognitive biases===
Research has shown that biased decision-making does not alone explain a significant proportion of inequality, therefore inequality cannot be explained by cognitive biases of a specific sub-population, such as temporal discounting (i.e., not preferring immediate funds over larger future gains), overestimation (i.e. thinking you are better than you are at making decisions), over-placement (i.e. thinking you are better than the average person at making decisions), and extremeness aversion (i.e. taking the 'middle option' simply because it seems safer than the highest or lowest).<ref name="urlCognitive_Biases_Not_Explaining_Inequality | Nature.com">{{Cite journal|title=The persistence of cognitive biases in financial decisions across economic groups |first1=Kai |last1=Ruggeri |last2=Ashcroft-Jones |first2=S. |last3=Abate Romero Landini |first3=G. |journal=Scientific Reports |date=June 26, 2023 |volume=13 |issue=1 |page=10329 |doi=10.1038/s41598-023-36339-2 |pmid=37365245 |pmc=10293260 |bibcode=2023NatSR..1310329R }}</ref>

==Mitigating factors==
[[File:20220801 Economic stratification - cross-class friendships - bar chart.svg|thumb| upright=1.5| Social connectedness to people of higher income levels is a strong predictor of upward income mobility.<ref name=EconomicStratification/> However, data shows substantial social segregation correlating with economic income groups.<ref name=EconomicStratification>Data from {{cite journal |last1=Chetty |first1=Raj |last2=Jackson |first2=Matthew O. |last3=Kuchler |first3=Theresa |last4=Stroebel |first4=Johannes |last5=Hendren |first5=Nathaniel |last6=Fluegge |first6=Robert B. |last7=Gong |first7=Sara |last8=Gonzalez |first8=Frederico |last9=Grondin |first9=Armelle |last10=Jacob |first10=Matthew |display-authors=4 |title=Social capital I: measurement and associations with economic mobility |journal=Nature |date=August 1, 2022 |volume=608 |issue=7921 |pages=108–121 |doi=10.1038/s41586-022-04996-4 |pmid=35915342 |pmc=9352590 |bibcode=2022Natur.608..108C }} Charted in {{cite news |last1=Leonhardt |first1=David |title='Friending Bias' / A large new study offers clues about how lower-income children can rise up the economic ladder. |url=https://www.nytimes.com/2022/08/01/briefing/economic-ladder-rich-poor-americans.html |newspaper=The New York Times |date=August 1, 2022 |archive-url=https://web.archive.org/web/20220801104004/https://www.nytimes.com/2022/08/01/briefing/economic-ladder-rich-poor-americans.html |archive-date=August 1, 2022 |url-status=live }}</ref>]]
Countries with a [[Social:Left-wing politics|left-leaning]] [[Social:Legislature|legislature]] generally have lower levels of inequality.<ref>{{cite journal |doi=10.1353/wp.2003.0009 |title=Distribution and Redistribution in Postindustrial Democracies |journal=World Politics |volume=55 |issue=2 |pages=193–228 |year=2011 |last1=Bradley |first1=David |last2=Huber |first2=Evelyne |last3=Moller |first3=Stephanie |last4=Nielsen |first4=François |last5=Stephens |first5=John D. |hdl=10419/160937 |s2cid=873271 |url=http://www.lisdatacenter.org/wps/liswps/265.pdf }}</ref><ref>{{cite journal |doi=10.1177/000312240607100604 |jstor=25472438 |title=Politics and Inequality in Latin America and the Caribbean |journal=American Sociological Review |volume=71 |issue=6 |pages=943–63 |year=2006 |last1=Huber |first1=Evelyne |last2=Nielsen |first2=François |last3=Pribble |first3=Jenny |last4=Stephens |first4=John D. |s2cid=144270746 }}</ref> Many factors constrain economic inequality – they may be divided into two classes: market driven, and government sponsored. The relative merits and effectiveness of each approach is a subject of debate:

Market forces outside of government intervention that can reduce economic inequality include:
* [[Finance:Marginal propensity to consume|propensity to spend]]: with rising wealth & income, a person may spend more. In an extreme example, if one person owned everything, they would immediately need to hire people to maintain their properties, thus reducing the wealth concentration.<ref>{{cite journal |last1=García-Peñalosa |first1=Cecilia |last2=Turnovsky |first2=Stephen J. |year=2007 |title=Growth, Income Inequality, and Fiscal Policy: What Are the Relevant Trade-offs? |journal=Journal of Money, Credit and Banking |volume=39 |issue=2–3 |pages=369–94 |citeseerx=10.1.1.186.2754 |doi=10.1111/j.0022-2879.2007.00029.x}}</ref> On the other hand, high-income persons have higher propensity to save.<ref>{{cite journal |last1=Carroll |first1=Christopher |last2=Slacalek |first2=Jiri |last3=Kiichi |first3=Tokuoka |last4=White |first4=Matthew |date=2017 |title=The distribution of wealth and the marginal propensity to consume |journal=Quantitative Economics |volume=8 |issue=3 |pages=977–1020 |doi=10.3982/QE694 |doi-access=free}}</ref> Robin Maialeh then shows that increasing economic wealth decreases propensity to spend and increases propensity to invest which consequently leads to even greater growth rate of already rich agents.<ref>{{cite journal |last1=Maialeh |first1=Robin |date=2019 |title=Why Market Imperatives Invigorate Economic Inequality? Cobb-Douglas Utility Remodelled |url=http://www.panoeconomicus.org/index.php/jorunal/article/view/695/524 |journal=Panoeconomicus |volume=66 |issue=2 |pages=145–163 |doi=10.2298/PAN160220031M |doi-access=free}}</ref>
Typical [[Social:Government|government]] initiatives intended to reduce economic inequality include:
* Public education: increasing the supply of skilled labor and reducing income inequality due to education differentials.<ref>{{cite journal |doi=10.1353/jda.0.0052 |jstor=40376250 |title=How Can Education Policy Improve Income Distribution?: An Empirical Analysis of Education Stages and Measures on Income Inequality |journal=The Journal of Developing Areas |volume=43 |issue=2 |pages=51–77 |year=2010 |last1=Keller |first1=Katarina R.I. |doi-access=free }}</ref>
* [[Finance:Progressive tax|Progressive tax]]ation: the rich are taxed proportionally more than the poor, reducing the amount of income inequality in society if the change in taxation does not cause changes in income.<ref>
{{cite journal |ssrn=2566842 |title=The Impact of Economic Growth, Tax Policy and Economic Freedom on Income Inequality |first1=J. R. |last1=Clark |first2=Robert A. |last2=Lawson |journal=The Journal of Private Enterprise |year=2008 }}
</ref>
Research shows that since 1300, the only periods with significant declines in wealth inequality in Europe were the Black Death and the two World Wars.<ref>{{Cite web|url=http://voxeu.org/article/europe-s-rich-1300|title=The top rich in Europe in the long run of history (1300 to present day)|last=Alfani|first=Guido|date=January 15, 2017|website=VoxEU.org|access-date=January 16, 2017}}</ref> Historian Walter Scheidel posits that, since the Stone Age, only extreme violence, catastrophes and upheaval in the form of [[Social:Total war|total war]], Communist revolutions, the {{wipe|French Revolution}}, pestilence and state collapse have significantly reduced inequality.<ref>{{cite news |last=Scheidel|first=Walter |date=February 23, 2017 |title=Inequality Has Historically Been Leveled Only By Terrible Violence And Upheaval|url=https://www.huffingtonpost.com/entry/inequality-violence_us_58ac8381e4b0c5148b041897|work=The Huffington Post |access-date= March 30, 2017}}</ref><ref name=":13">{{cite news |last=Taylor |first= Matt|date=February 22, 2017 |title=One Recipe for a More Equal World: Mass Death |url=https://www.vice.com/en_us/article/ypxw55/one-recipe-for-a-more-equal-world-mass-death|work=Vice |access-date=April 7, 2017 }}</ref> He has stated that "only all-out thermonuclear war might fundamentally reset the existing distribution of resources" and that "peaceful policy reform may well prove unequal to the growing challenges ahead."<ref>{{cite news |last=Porter|first=Eduardo |date=December 6, 2016 |title=A Dilemma for Humanity: Stark Inequality or Total War|work=The New York Times |url=https://www.nytimes.com/2016/12/06/business/economy/a-dilemma-for-humanity-stark-inequality-or-total-war.html |access-date=March 30, 2017}}</ref><ref>{{cite book| last=Scheidel| first=Walter|  title=The Great Leveler: Violence and the History of Inequality from the Stone Age to the Twenty-First Century| publisher=Princeton University Press| location=Princeton| year=2017| isbn=978-0691165028 |url=http://press.princeton.edu/titles/10921.html|pages=438, 444}}</ref> However, Scheidel also stated that "There is certainly room for incremental change, that's what the example of Latin America shows in the past 15 years or so."<ref name=":13" />

===Policy responses intended to mitigate===
A 2011 OECD study makes a number of suggestions to its member countries, including:<ref name="oecd-dws"/>
* Well-targeted income-support policies.
* Facilitation and encouragement of access to employment.
* Better job-related training and education for the low-skilled (on-the-job training) would help to boost their productivity potential and future earnings.
* Better access to formal education.

[[Finance:Progressive tax|Progressive tax]]ation reduces absolute income inequality when the higher rates on higher-income individuals are paid and not [[Finance:Tax evasion|evaded]], and transfer payments and [[Social:Social safety net|social safety net]]s result in progressive [[Finance:Gross fixed capital formation#Economic analysis|government spending]].<ref>{{cite journal | last1 = Moyes | first1 = P | year = 1988| title = A note on minimally progressive taxation and absolute income inequality | journal = Social Choice and Welfare | volume = 5 | issue = 2–3| pages = 227–34 | doi = 10.1007/BF00735763 | s2cid = 189918945 }}</ref><ref>Pickett and Wilkinson, ''The Spirit Level: Why More Equal Societies Almost Always Do Better'', 2011</ref><ref>{{cite web|last=Duncan|first=Denvil, Klara Sabirianova Peter|title=Unequal Inequalities: Do Progressive Taxes Reduce Income Inequality?|url=http://ftp.iza.org/dp6910.pdf|publisher=Institute for the Study of Labor|date=October 2012}}</ref> Wage ratio legislation has also been proposed as a means of reducing income inequality. The [[Organization:OECD|OECD]] asserts that public spending is vital in reducing the ever-expanding wealth gap.<ref name="OECD13">[https://www.huffingtonpost.com/2013/05/14/wealth-gap-widens-austerity-inequlity_n_3275538.html Wealth Gap Widens In Rich Countries As Austerity Threatens To Worsen Inequality: OECD]. ''The Huffington Post.'' Retrieved May 14, 2013</ref>

Deferred investment programs that increase stock ownership amongst lower income levels can supplement income to compensate wage stagnation.<ref name=":8" />

The economists Emmanuel Saez and [[Biography:Thomas Piketty|Thomas Piketty]] recommend much higher top marginal tax rates on the wealthy, up to 50 percent, 70 percent or even 90 percent.<ref>Annie Lowrey (April 16, 2012). [https://www.nytimes.com/2012/04/17/business/for-economists-saez-and-piketty-the-buffett-rule-is-just-a-start.html For Two Economists, the Buffett Rule Is Just a Start]. ''The New York Times.'' Retrieved August 17, 2013.</ref> Ralph Nader, Jeffrey Sachs, the United Front Against Austerity, among others, call for a [[Finance:Financial transaction tax|financial transaction tax]] (also known as the Robin Hood tax) to bolster the social safety net and the public sector.<ref>Nader, Ralph (April 18, 2013). [https://www.huffingtonpost.com/ralph-nader/financial-transactions-tax_b_3109421.html Time for a Sales Tax on Wall Street Financial Transactions]. ''The Huffington Post.'' Retrieved June 5, 2013.</ref><ref>Erika Eichelberger (October 30, 2013). [https://www.motherjones.com/mojo/2013/10/financial-transaction-tax-robin-hood-jeffrey-sachs Economists to Congress: It's Time for a "Robin Hood Tax" on the Rich]. ''Mother Jones.'' Retrieved November 15, 2013.</ref>

''[[Finance:The Economist|The Economist]]'' wrote in December 2013: "A minimum wage, providing it is not set too high, could thus boost pay with no ill effects on jobs....America's federal minimum wage, at 38% of median income, is one of the rich world's lowest. Some studies find no harm to employment from federal or state minimum wages, others see a small one, but none finds any serious damage."<ref>{{Cite news|url=https://www.economist.com/news/leaders/21591593-moderate-minimum-wages-do-more-good-harm-they-should-be-set-technocrats-not|title=The logical floor|newspaper=[[Finance:The Economist|The Economist]]|date=December 14, 2013}}</ref>

General limitations on and taxation of [[Social:Rent-seeking|rent-seeking]] are popular across the political spectrum.<ref>{{cite news|last=Konczal|first=Mike|title=How an anti-rentier agenda might bring liberals, conservatives together|url=https://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/30/ow-an-anti-rentier-agenda-might-bring-liberals-conservatives-together/|access-date=April 6, 2013|newspaper={{wipe|The Washington Post}}|date=March 30, 2013}}</ref>

Public policy responses addressing causes and effects of income inequality in the US include: [[Finance:Progressive tax|progressive]] tax incidence adjustments, strengthening [[Social:Social safety net|social safety net]] provisions such as Aid to Families with Dependent Children, welfare, the food stamp program, Social Security, Medicare, and Medicaid, organizing community interest groups, increasing and reforming [[Social:Higher education|higher education]] subsidies, increasing [[Physics:Infrastructure|infrastructure]] spending, and placing limits on and taxing [[Social:Rent-seeking|rent-seeking]].<ref>{{cite news|last=Grusky|first=David B.|title=What to Do about Inequality|url=https://www.bostonreview.net/BR37.2/ndf_david_b_grusky_inequality.php|access-date=April 6, 2013|newspaper=Boston Review|date=March–April 2013|archive-url=https://web.archive.org/web/20130420175636/http://www.bostonreview.net/BR37.2/ndf_david_b_grusky_inequality.php|archive-date=April 20, 2013|url-status=dead}}</ref>

A 2017 study in the ''[[Finance:Journal of Political Economy|Journal of Political Economy]]'' by Daron Acemoglu, James Robinson and Thierry Verdier argues that American "cutthroat" capitalism and inequality gives rise to technology and innovation that more "cuddly" forms of capitalism cannot.<ref name=":1">{{cite journal |doi=10.1086/693038 |title=Asymmetric Growth and Institutions in an Interdependent World |journal=Journal of Political Economy |volume=125 |issue=5 |pages=1245–1305 |year=2017 |last1=Acemoglu |first1=Daron |last2=Robinson |first2=James A. |last3=Verdier |first3=Thierry |hdl=1721.1/118645 |s2cid=154662416 |hdl-access=free }}</ref> As a result, "the diversity of institutions we observe among relatively advanced countries, ranging from greater inequality and risk-taking in the United States to the more egalitarian societies supported by a strong safety net in Scandinavia, rather than reflecting differences in fundamentals between the citizens of these societies, may emerge as a mutually self-reinforcing world equilibrium. If so, in this equilibrium, 'we cannot all be like the Scandinavians,' because Scandinavian capitalism depends in part on the knowledge spillovers created by the more cutthroat American capitalism."<ref name=":1" /> A 2012 working paper by the same authors, making similar arguments, was challenged by Lane Kenworthy, who posited that, among other things, the Nordic countries are consistently ranked as some of the world's most innovative countries by the [[Organization:World Economic Forum|World Economic Forum]]'s Global Competitiveness Index, with Sweden ranking as the most innovative nation, followed by Finland, for 2012–2013; the U.S. ranked sixth.<ref>{{cite book | title = Social Democratic America | first1 = Kenworthy | last1 = Lane |  date = 2015 | isbn = 978-0190230951 | publisher = [[Organization:Oxford University Press|Oxford University Press]] | url=https://books.google.com/books?id=c4oUDAAAQBAJ&pg=PA88 | pages = 88–93 | location = US}}</ref>

There are however global initiative like the United Nations Sustainable Development Goal 10 which aims to garner international efforts in reducing economic inequality considerably by 2030.<ref>{{Cite web |title=Goal 10 targets |website=UNDP|url=https://www.undp.org/content/undp/en/home/sustainable-development-goals/goal-10-reduced-inequalities/targets.html|access-date=September 23, 2020|url-status=dead|archive-url=https://web.archive.org/web/20201127140337/https://www.undp.org/content/undp/en/home/sustainable-development-goals/goal-10-reduced-inequalities/targets.html|archive-date=November 27, 2020}}</ref>

==Effects==
{{main|Finance:Effects of economic inequality}}
A lot of research has been done about the effects of economic inequality on different aspects in society:
* '''Health''': For long time the higher material living standards lead to longer life, as those people were able to get enough food, water and access to warmth. British researchers Richard G. Wilkinson and Kate Pickett have found higher rates of health and social problems (obesity, mental illness, homicides, teenage births, incarceration, child conflict, drug use) in countries and states with higher inequality.<ref name="The Spirit Level">{{cite web|url=http://www.equalitytrust.org.uk/resources/slides|title=The Spirit Level|work=equalitytrust.org.uk}}</ref><ref name="Income inequality and health: a cau">{{cite journal|last1=Pickett|first1=KE|last2=Wilkinson|first2=RG|title=Income inequality and health: a causal review.|journal=Social Science & Medicine|date=March 2015|volume=128|pages=316–26|doi=10.1016/j.socscimed.2014.12.031|pmid=25577953}}</ref> Their research included 24 developed countries, including most U.S. states, and found that in the more developed countries, such as Finland and Japan, the heath issues are much lower than in states with rather higher inequality rates, such as Utah and New Hampshire. Some studies link a surge in "deaths of despair", suicide, drug overdoses and alcohol related deaths, to widening income inequality.<ref>{{cite news|last=Woodward|first=Aylin|date=November 30, 2019|title=Life expectancy in the US keeps going down, and a new study says America's worsening inequality could be to blame|url=https://www.businessinsider.my/us-life-expectancy-declined-for-third-year-in-a-row-2019-11/|work=Business Insider|access-date=December 18, 2019|archive-date=December 18, 2019|archive-url=https://web.archive.org/web/20191218004240/https://www.businessinsider.my/us-life-expectancy-declined-for-third-year-in-a-row-2019-11/|url-status=dead}}</ref><ref>{{cite news |last1= Coughlan|first1=Sean|last2= Brown|first2=David|date=May 14, 2019 |title=Inequality driving 'deaths of despair'|url=https://www.bbc.com/news/education-48229037|work=BBC |access-date=December 18, 2019 }}</ref> Conversely, other research did not find these effects or concluded that research suffered from issues of confounding variables.<ref>Antony, Jürgen, and Torben Klarl. "Estimating the income inequality-health relationship for the United States between 1941 and 2015: Will the relevant frequencies please stand up?." The Journal of the Economics of Ageing 17 (2020): 100275.</ref>
* '''Social goods''': British researchers Richard G. Wilkinson and Kate Pickett have found lower rates of social goods (life expectancy by country, educational performance, trust among strangers, women's status, [[Social:Social mobility|social mobility]], even numbers of [[Social:Patent|patent]]s issued) in countries and states with higher inequality.<ref name="The Spirit Level"/><ref name="Income inequality and health: a cau"/>
* '''Social cohesion''': Research has shown an inverse link between income inequality and social cohesion. In more equal societies, people are much more likely to trust each other, measures of [[Social:Social capital|social capital]] (the benefits of goodwill, fellowship, mutual sympathy and social connectedness among groups who make up a social units) suggest greater community involvement.
*''' Happiness''': According to the 2019 World Happiness Report, increasing socioeconomic inequality, along with rising healthcare costs, surging addiction rates, and an unhealthy work–life balance, are causes of unhappiness around the world.<ref>{{cite news |last= Conley |first=Julia|date=March 20, 2019
|title=Social Democratic Nations Rank Happiest on Global Index (Again). US Ranking Falls (Again)|url=https://www.truthdig.com/articles/social-democracies-top-global-happiness-index-again-u-s-falls-again/|work=Common Dreams |access-date=August 21, 2023}}</ref><ref>[https://s3.amazonaws.com/happiness-report/2019/WHR19.pdf World Happiness Report 2019]</ref>
* '''Crime''': The cross national research shows that in societies with less economic inequality the homicide rates are consistently lower.<ref>{{cite journal |doi=10.1016/S0047-2352(98)00064-6 |title=A comparative analysis of nations with low and high levels of violent crime |journal=Journal of Criminal Justice |volume=27 |issue=3 |pages=259–74 |year=1999 |last1=Neapolitan |first1=Jerome L }}</ref> A 2016 study finds that interregional inequality increases terrorism.<ref>{{cite journal |doi=10.1016/j.ejpoleco.2016.01.004 |title=Terrorism and spatial disparities: Does interregional inequality matter? |journal=European Journal of Political Economy |volume=42 |pages=60–74 |year=2016 |last1=Ezcurra |first1=Roberto |last2=Palacios |first2=David }}</ref> Other research has argued inequality has little effect on crime rates.<ref>{{cite journal |doi=10.1007/s00148-015-0579-3 |title=Inequality and crime revisited: Effects of local inequality and economic segregation on crime |journal=Journal of Population Economics |volume=29 |issue=2 |pages=593–626 |year=2015 |last1=Kang |first1=Songman |s2cid=155852321 }}</ref><ref>Corvalana, Alejandro, and Matteo Pazzonab. "Does Inequality Really Increase Crime? Theory and Evidence." In Technical Report. 2019.</ref>
* '''Welfare''': Studies have found evidence that in societies where inequality is lower, population-wide satisfaction and happiness tend to be higher.<ref name="happiniess">{{cite web |author=Richard Layard |title=Happiness: Has Social Science A Clue? |work=Lionel Robbins Memorial Lectures |date=March 3–5, 2003 |url=http://stoa.org.uk/topics/happiness/Happiness%20-%20Has%20Social%20Science%20A%20Clue.pdf |archive-url=https://web.archive.org/web/20130603132909/http://stoa.org.uk/topics/happiness/Happiness%20-%20Has%20Social%20Science%20A%20Clue.pdf|archive-date=June 3, 2013 |url-status=dead}}</ref>{{sfnm|1a1=Blanchard|2a1=Oswald|1y=2000|2y=2003|2loc={{vn|date=November 2022|reason=garbled cite, 2 authors, 2 dates. My best guess follows.}}}}<ref>{{cite book |last=Blanchard |first=Olivier |year=2000 |title=Macroeconomics |edition=2nd |place=Upper Saddle River N.J |publisher=Prentice-Hall |oclc=42454429}}{{vn|date=November 2022|reason=This is a guess.}}</ref><ref>{{cite journal |last=Oswald |first=Andrew J. |title=How Much do External Factors Affect Wellbeing? A Way to Use 'Happiness Economics' to Decide |journal=The Psychologist |date=2003 |volume=16 |pages=140–141 |url=https://www.andrewoswald.com/docs/finalsentthepsychologistaug2002.pdf}}{{vn|date=November 2022|reason=This is a guess.}}</ref>
* '''Poverty:''' Study made by Jared Bernstein and Elise Gould suggest, that the poverty in the United States could have been reduced by the lowering of economic inequality for the past few decades.<ref>{{Cite web |last=Bernstein |first=Jared|date=January 13, 2014|title=Poverty and Inequality, in Charts |website=Economix Blog |url=https://economix.blogs.nytimes.com/2014/01/13/poverty-and-inequality-in-charts/ |access-date=April 30, 2021}}</ref><ref>{{Cite web|title=No Matter How We Measure Poverty, the Poverty Rate Would Be Much Lower If Economic Growth Were More Broadly Shared|website=Economic Policy Institute |url=https://www.epi.org/blog/matter-measure-poverty-poverty-rate-economic/ |access-date=April 30, 2021}}</ref>
* '''Debt''': Income inequality has been the driving factor in the growing [[Finance:Household debt|household debt]],<ref name=denial>[http://www.tnr.com/blog/plank/109157/conservative-inequality-denialism "Conservative Inequality Denialism,"] by Timothy Noah ''The New Republic'' (October 25, 2012)</ref><ref>[http://newamerica.net/publications/policy/the_way_forward The Way Forward] {{Webarchive |url=https://archive.today/20120711200159/http://newamerica.net/publications/policy/the_way_forward |date=July 11, 2012 }} By Daniel Alpert, Westwood Capital; Robert Hockett, Professor of Law, Cornell University; and Nouriel Roubini, Professor of Economics, New York University, New America Foundation, October 10, 2011</ref> as high earners bid up the price of real estate and middle income earners go deeper into debt trying to maintain what once was a middle class lifestyle.<ref name=plumer>{{cite news|last=Plumer |first=Brad|date=March 27, 2013|title='Trickle-down consumption': How rising inequality can leave everyone worse off |url=https://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/27/trickle-down-consumption-how-rising-inequality-can-leave-everyone-worse-off/|newspaper=Washington Post|access-date=March 27, 2013}}</ref>
* '''Economic growth''': A 2016 meta-analysis found that "the effect of inequality on growth is negative and more pronounced in less developed countries than in rich countries", though the average impact on growth was not significant. The study also found that wealth inequality is more pernicious to growth than income inequality.<ref name=":0"/>
* '''Civic participation''': Higher income inequality led to less of all forms of social, cultural, and civic participation among the less wealthy.<ref>Bram Lancee and Hermanvande Werfhorst (2011) [http://www.uva-aias.net/uploaded_files/publications/DP6-Lancee,vdWerfhorst-2.pdf "Income Inequality and Participation: A Comparison of 24 European Countries"] GINI Discussion Paper No. 6 (Amsterdam Centre for Inequality Studies)</ref>
* '''Political instability''': Studies indicate that economic inequality leads to greater political instability, including an increased risk of democratic breakdown<ref name=":5" /><ref>{{cite journal |last1=Alesina|first1=Alberto |last2=Perotti|first2=Roberto|year=1996|title=Income distribution, political instability, and investment|url=http://nrs.harvard.edu/urn-3:HUL.InstRepos:4553018 |journal=European Economic Review|volume=40|issue=6|pages=1203–1228 |doi=10.1016/0014-2921(95)00030-5 |s2cid=51838517}}</ref><ref name="Lieberman">{{Cite journal|author=Robert C. Lieberman|author2=Suzanne Mettler|author3=Thomas B. Pepinsky|author4=Kenneth M. Roberts|author5=Richard Valelly |date=June 2019|title=The Trump Presidency and American Democracy: A Historical and Comparative Analysis|journal=Perspectives on Politics|volume=17 |issue=2|pages=470–79|doi=10.1017/S1537592718003286|doi-access=free}}</ref><ref name=":22">{{Cite journal|author=Walder, D.|author2=Lust, E.|date=2018|title=Unwelcome Change: Coming to Terms with Democratic Backsliding|journal=Annual Review of Political Science|volume=21|issue=1|pages=93–113 |doi=10.1146/annurev-polisci-050517-114628|doi-access=free}}</ref><ref name=":42">{{Cite journal |last1=Huq|first1=Aziz|last2=Ginsburg|first2=Tom|date=2018|title=How to Lose a Constitutional Democracy |journal=UCLA Law Review|volume=65|pages=78–169|url=https://heinonline.org/HOL/Page?handle=hein.journals/uclalr65&div=5&g_sent=1&casa_token=&collection=journals&t=1558094508}}</ref> and civil conflict.<ref>{{Cite journal|last1=Baten|first1=Joerg |last2=Mumme|first2=Christina|date=December 1, 2013 |title=Does inequality lead to civil wars? A global long-term study using anthropometric indicators (1816–1999) |url=https://www.sciencedirect.com/science/article/pii/S0176268013000402 |journal=European Journal of Political Economy|volume=32|pages=56–79|doi=10.1016/j.ejpoleco.2013.06.007|issn=0176-2680}}</ref><ref name=":6" /> A significant impact of inequality on civil war probability has been found through anthropometric methods.<ref>{{Cite journal|last=Christina Mumme and Jörg Baten|title=Civil War Determinants From a Long-Term Perspective: Was There Impact Of Anthropometric Deprivation From 1816-1999?|journal=European Review of Political Economy|volume=32 |date=2014 |pages=56–79}}</ref>
* '''Political party responses:''' One study finds that economic inequality prompts attempts by left-leaning politicians to pursue redistributive policies while right-leaning politicians seek to repress the redistributive policies.<ref>{{Cite journal|last1=Connell|first1=Brendan J.|last2=Dorr|first2=Dalton C. |last3=Shin|first3=Adrian J.|date=March 6, 2021|title=Inequality and the Partisan Political Economy|journal=Representation|volume=57|issue=4|pages=575–601 |doi=10.1080/00344893.2021.1883100 |s2cid=233845379|issn=0034-4893}}</ref>

==Perspectives==
===Fairness vs. equality===
According to Christina Starmans et al. (Nature Hum. Beh., 2017), the research literature contains no evidence on people having an aversion to inequality. In all studies analyzed, the subjects preferred fair distributions ([[Inequity aversion|inequity aversion]]) to [[Social:Equality of outcome|equal]] distributions, in both laboratory and real-world situations. In public, researchers may loosely speak of equality instead of fairness, when referring to studies where fairness happens to coincide with equality, but in many studies fairness is carefully separated from equality and the results are univocal. Very young children seem to prefer fairness over equality.<ref name="Starmans, Sheskin & Bloom 2017">{{cite journal |doi=10.1038/s41562-017-0082 |title=Why people prefer unequal societies |journal=Nature Human Behaviour |volume=1 |issue=4 |pages=0082 |year=2017 |last1=Starmans |first1=Christina |last2=Sheskin |first2=Mark |last3=Bloom |first3=Paul |s2cid=3946231 }}</ref>

When people were asked, what would be the wealth of each quintile in their ideal society, they gave a 50-fold sum to the richest quintile than to the poorest quintile. The preference for inequality increases in adolescence, and so do the capabilities to favor fortune, effort and ability in the distribution.<ref name="Starmans, Sheskin & Bloom 2017"/>

Preference for unequal distribution has been developed to the human race possibly because it allows for better co-operation and allows a person to work with a more productive person so that both parties benefit from the co-operation. Inequality is also said to be able to solve the problems of [[Philosophy:Free-rider problem|free-riders]], cheaters and ill-behaving people, although this is heavily debated.<ref name="Starmans, Sheskin & Bloom 2017"/> Researches demonstrate that people usually underestimate the level of actual inequality, which is also much higher than their desired level of inequality.<ref>{{cite journal |last1=Hauser |first1=Oliver |last2=Norton |first2=Michael |title=(Mis)perceptions of inequality |journal=Current Opinion in Psychology |volume=18 |date=2017 |issue=18 |pages=21–25|doi=10.1016/j.copsyc.2017.07.024 |pmid=29221507 |hdl=10871/33591 |hdl-access=free }}</ref>

In many societies, such as the USSR, the distribution led to protests from wealthier landowners.<ref>Editors of Encyclopædia Britannica. ''Kulak | Russian peasant class''. Encyclopædia Britannica inc. 2016.</ref> In the current U.S., many feel that the distribution is unfair in being too unequal. In both cases, the cause is unfairness, not inequality, the researchers conclude.<ref name="Starmans, Sheskin & Bloom 2017"/>

===Socialist perspectives===
Socialists attribute the vast disparities in wealth to the private ownership of the [[Social:Means of production|means of production]] by a class of owners, creating a situation where a small portion of the population lives off [[Finance:Unearned income|unearned]] property income by virtue of ownership titles in capital equipment, financial assets and corporate stock. By contrast, the vast majority of the population is dependent on income in the form of a wage or salary. In order to rectify this situation, socialists argue that the means of production should be [[Social:Social ownership|socially owned]] so that income differentials would be reflective of [[Social:To each according to his contribution|individual contributions]] to the social product.<ref>Barbara Goodwin. Using Political Ideas. West Sussex, England, UK: John Wiley & Sons, Ltd., 2007. p. 107.</ref>

[[Finance:Marxian economics|Marxian economics]] attributes rising inequality to job automation and [[Finance:Capital deepening|capital deepening]] within capitalism. The process of job automation conflicts with the capitalist property form and its attendant system of wage labor. In this analysis, capitalist firms increasingly substitute capital equipment for labor inputs (workers) under competitive pressure to reduce costs and maximize profits. Over the long term, this trend increases the [[Finance:Organic composition of capital|organic composition of capital]], meaning that less workers are required in proportion to capital inputs, increasing unemployment (the "[[Finance:Reserve army of labour|reserve army of labour]]"). This process exerts a downward pressure on wages. The substitution of capital equipment for labor (mechanization and automation) raises the productivity of each worker, resulting in a situation of relatively stagnant wages for the working class amidst rising levels of property income for the capitalist class.<ref>{{cite book |last= Wood|first= John Cunningham |title= Karl Marx's Economics: Critical Assessments I and II |publisher=Routledge|year= 1996 |isbn= 978-0415087148}}</ref>

Marxist socialists ultimately predict the emergence of a [[Social:Communist society|communist society]] based on the common ownership of the means of production, where each individual citizen would have free access to the articles of consumption (''From each according to his ability, to each according to his need''). According to Marxist philosophy, equality in the sense of free access is essential for freeing individuals from dependent relationships, thereby allowing them to transcend [[Social:Marx's theory of alienation|alienation]].<ref>{{cite web |url=http://econc10.bu.edu/okyn/OKpers/Income_Distribution/Edusex_indi/edusex_normative_view.htm |title=The Normative View of Marxian Theory on Income Distribution under Socialism |author=Oldrich Kyn |access-date=November 30, 2013 |archive-url=https://web.archive.org/web/20150314185131/http://econc10.bu.edu/okyn/OKpers/Income_Distribution/Edusex_indi/edusex_normative_view.htm |archive-date=March 14, 2015 |url-status=dead }}</ref>

===Meritocracy===
[[Philosophy:Meritocracy|Meritocracy]] favors an eventual society where an individual's success is a direct function of his merit, or contribution. Economic inequality would be a natural consequence of the wide range in individual skill, talent and effort in human population. David Landes stated that the progression of Western economic development that led to the [[History:Industrial Revolution|Industrial Revolution]] was facilitated by men advancing through their own merit rather than because of family or political connections.<ref>
{{cite book
|title=The Unbound Prometheus: Technological Change and Industrial Development in Western Europe from 1750 to the Present
 |last=Landes
 |first= David. S.
|year= 1969|publisher =Press Syndicate of the University of Cambridge
|location= Cambridge & New York
|isbn= 978-0521094184
}}
</ref>

===Liberal perspectives===
Most modern [[Philosophy:Social liberalism|social liberals]], including centrist or left-of-center political groups, believe that the capitalist economic system should be fundamentally preserved, but the status quo regarding the income gap must be reformed. Social liberals favor a capitalist system with active [[Finance:Keynesian economics|Keynesian]] macroeconomic policies and progressive taxation (to even out differences in income inequality). Research indicates that people who hold liberal beliefs tend to see greater income inequality as morally wrong.<ref>O'Donnell, Michael, and Serena Chen. "Political Ideology, the Moralizing of Income Inequality, and Its Social Consequences." Available at SSRN 3253666 (2018).</ref>

However, contemporary classical liberals and libertarians generally do not take a stance on wealth inequality, but believe in equality under the law regardless of whether it leads to unequal wealth distribution. In 1966 Ludwig von Mises, a prominent figure in the [[Social:Austrian School|Austrian School]] of economic thought, explains:

<blockquote>The liberal champions of equality under the law were fully aware of the fact that men are born unequal and that it is precisely their inequality that generates social cooperation and civilization. Equality under the law was in their opinion not designed to correct the inexorable facts of the universe and to make natural inequality disappear. It was, on the contrary, the device to secure for the whole of mankind the maximum of benefits it can derive from it. Henceforth no man-made institutions should prevent a man from attaining that station in which he can best serve his fellow citizens.</blockquote>

[[Biography:Robert Nozick|Robert Nozick]] argued that government redistributes wealth by force (usually in the form of taxation), and that the ideal moral society would be one where all individuals are free from force. However, Nozick recognized that some modern economic inequalities were the result of forceful taking of property, and a certain amount of redistribution would be justified to compensate for this force but not because of the inequalities themselves.<ref>{{Cite book|last=Nozick |first=Robert|title=Anarchy, state, and utopia |title-link=Anarchy, State, and Utopia |date=1974|publisher=Blackwell Publishing|isbn=978-0631197805|oclc=1120103788}}</ref> [[Biography:John Rawls|John Rawls]] argued in ''[[Social:A Theory of Justice|A Theory of Justice]]''<ref name="RawlsJustice">{{cite book |last=Rawls |first=John |title=A Theory of Justice |year=2005 |publisher=Belknap Press of Harvard University Press |isbn=978-0674017726|title-link=A Theory of Justice }}</ref> that inequalities in the distribution of wealth are only justified when they improve society as a whole, including the poorest members. Rawls does not discuss the full implications of his theory of justice. Some see Rawls's argument as a justification for [[Philosophy:Capitalism|capitalism]] since even the poorest members of society theoretically benefit from increased innovations under capitalism; others believe only a strong [[Social:Welfare state|welfare state]] can satisfy Rawls's theory of justice.<ref>{{Cite book|last=Barry, Brian|url=|title=The liberal theory of justice : a critical examination of the principal doctrines in A theory of justice by John Rawls|date=1975|publisher=Clarendon Press|isbn=0198245092|oclc=476228713}}</ref>

Classical liberal [[Biography:Milton Friedman|Milton Friedman]] believed that if government action is taken in pursuit of economic equality then political freedom would suffer. In a famous quote, he said:

<blockquote>A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both.</blockquote>

Economist Tyler Cowen has argued that though income inequality has increased within nations, globally it has fallen over the 20 years leading up to 2014. He argues that though income inequality may make individual nations worse off, overall, the world has improved as global inequality has been reduced.<ref>{{cite news|last1=Cowen|first1=Tyler|title=Income Inequality Is Not Rising Globally. It's Falling.|url=https://www.nytimes.com/2014/07/20/upshot/income-inequality-is-not-rising-globally-its-falling-.html|access-date=July 26, 2014|work=The New York Times|date=July 19, 2014}}</ref>

===Social justice arguments===
Patrick Diamond and Anthony Giddens (professors of Economics and Sociology, respectively) hold that 'pure [[Philosophy:Meritocracy|meritocracy]] is incoherent because, without redistribution, one generation's successful individuals would become the next generation's embedded caste, hoarding the wealth they had accumulated'.<ref>{{Cite thesis |last=Li |first=Robert |date=July 1, 2011 |title='KILLING THE NOOB' A thesis on Meritocracy and what it has to do with Massive Multiplayer Online Role Playing Games |publisher=Swinburne University of Technology |degree=Bachelor of Arts with Honours |url=https://www.academia.edu/6719442}}</ref>

They also state that [[Social:Social justice|social justice]] requires redistribution of high incomes and large concentrations of wealth in a way that spreads it more widely, in order to "recognize the contribution made by all sections of the community to building the nation's wealth." (Patrick Diamond and Anthony Giddens, June 27, 2005, New Statesman)<ref>{{Cite web|url=http://www.newstatesman.com/200506270022 |work=New Statesman |author=Anthony Giddens |date=27 June 2005 |title=NS Essay – 'Accumulation of wealth is unjust where it arises not from hard work and risk-taking enterprise, but from ''brute luck'' factors such as returns from property. Inheritance is a form of brute-luck inequality' |url-status=dead |archive-url=https://web.archive.org/web/20071209055040/http://www.newstatesman.com/200506270022 |archive-date=2007-12-09}}</ref>

Pope Francis stated in his ''[[Religion:Evangelii gaudium|Evangelii gaudium]]'', that "as long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation and by attacking the structural causes of inequality, no solution will be found for the world's problems or, for that matter, to any problems."<ref>John Nichols (December 2, 2013). [http://billmoyers.com/2013/12/02/the-pope-versus-unfettered-capitalism/ Pope: "King Money" Culture is Hurting Young and Old]. ''Moyers & Company.'' Retrieved December 8, 2013.</ref> He later declared that "inequality is the root of social evil."<ref>Andrew Brown (April 28, 2014). [https://www.theguardian.com/commentisfree/2014/apr/28/pope-francis-condemns-inequality-john-paul Pope Francis condemns inequality, thus refusing to play the game]. ''The Guardian.'' Retrieved May 27, 2014.<!--Expanded quote from the ''Evangelii gaudium'' for clarification purposes: "Just as the commandment 'Thou shalt not kill' sets a clear limit in order to safeguard the value of human life, today we also have to say 'Thou shalt not' to an economy of exclusion and inequality. Such an economy kills … Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalised: without work, without possibilities, without any means of escape. Human beings are themselves considered consumer goods to be used and then discarded."--></ref>

When income inequality is low, [[Aggregate demand|aggregate demand]] will be relatively high, because more people who want ordinary consumer goods and services will be able to afford them, while the labor force will not be as relatively [[Finance:Monopolization|monopolized]] by the wealthy.<ref name=pigou>''[http://www.econlib.org/library/NPDBooks/Pigou/pgEW8.html The Economics of Welfare]''| Arthur Cecil Pigou</ref>

===Effects on social welfare===
In most western democracies, the desire to eliminate or reduce economic inequality is generally associated with the political left. One practical argument in favor of reduction is the idea that economic inequality reduces social cohesion and increases social unrest, thereby weakening the society. There is evidence that this is true (see [[Inequity aversion|inequity aversion]]) and it is intuitive, at least for small face-to-face groups of people.<ref>{{Cite web |title=inequity - Traduction anglais-arabe {{!}} PONS |url=https://fr.pons.com/traduction/anglais-arabe/inequity |access-date=June 18, 2022 |website=fr.pons.com}}</ref> Alberto Alesina, Rafael Di Tella, and Robert MacCulloch find that inequality negatively affects [[Philosophy:Happiness|happiness]] in Europe but not in the United States.<ref>{{Cite web|url=http://www.cepr.org/pubs/dps/DP2877.asp|archive-url=https://web.archive.org/web/20140201195135/http://www.cepr.org/pubs/dps/DP2877.asp|url-status=dead|title=Inequality and Happiness: Are Europeans and Americans Different?|archive-date=February 1, 2014}}</ref>

It has also been argued that economic inequality invariably translates to political inequality, which further aggravates the problem. Even in cases where an increase in economic inequality makes nobody economically poorer, an increased inequality of resources is disadvantageous, as increased economic inequality can lead to a power shift due to an increased inequality in the ability to participate in democratic processes.<ref>The relation between economic inequality and political inequality is explained by Robert Alan Dahl in the chapters ''The Presence of a Market Economy'' (p. 63), ''The Distribution of Political Resources'' (p. 84) und ''Market Capitalism and Human Dispositions'' (p. 87) in ''On Political Equality'', 2006, 120 pages, Yale University Press, {{ISBN|978-0300126877}}</ref> According to Paul and Moser, countries with high income inequality and poor unemployment protections experience worse mental health outcomes among the unemployed.<ref>{{Cite web |title=The toll of job loss |url=https://www.apa.org/monitor/2020/10/toll-job-loss |access-date=2023-11-26 |website=www.apa.org}}</ref>

===Capabilities approach===
{{Further|Social:Capability approach}}

The capabilities approach – sometimes called the human development approach – looks at income inequality and poverty as form of "capability deprivation".<ref name="sen development">{{cite conference
| author    = Amartya Sen
| year      = 1999
| title     = Poverty as Capability Deprivation
| book-title = Development as Freedom
| publisher = Anchor Books
| place     = New York
}}</ref> Unlike [[Social:Neoliberalism|neoliberalism]], which "defines well-being as utility maximization", economic growth and income are considered a means to an end rather than the end itself.<ref>{{cite journal |last1=Fukuda-Parr |first1=Sakiko |title=The Human Development Paradigm: Operationalizing Sen's Ideas on Capabilities |journal=Feminist Economics |date=2003 |volume=9 |issue=2–3 |pages=301–17 |s2cid=18178004 |doi=10.1080/1354570022000077980}}</ref> Its goal is to "wid[en] people's choices and the level of their achieved well-being"<ref name="UNDP">{{cite report |author=UNDP (United Nations Development Programme) |url=https://hdr.undp.org/system/files/documents//hdr1990encompletenostatspdf.pdf |date=January 1, 1990 |title=Human Deuelopment Report 1990 |publisher=Oxford University Press |place=Oxford & New York}} Via [https://hdr.undp.org/content/human-development-report-1990 Human Deuelopment Reports]</ref> through increasing functioning (the things a person values doing), capabilities (the freedom to enjoy functionings) and agency (the ability to pursue valued goals).<ref name=Deneulin_Alkire>{{Citation |last1=Deneulin |first1=Séverine |last2=Alkire |first2=Sabina | author-link2=Sabina Alkire |contribution=The human development and capability approach |editor-last1=Deneulin |editor-first1=Séverine |editor-last2=Shahani |editor-first2=Lila |title=An introduction to the human development and capability approach freedom and agency |pages=22–48 |publisher=Earthscan International Development Research Centre |location=Sterling, VA & Ottawa, Ontario |year=2009 |isbn=978-1844078066}}</ref>

When a person's capabilities are lowered, they are in some way deprived of earning as much income as they would otherwise. An old, ill man cannot earn as much as a healthy young man; [[Social:Gender role|gender role]]s and customs may prevent a woman from receiving an education or working outside the home. There may be an epidemic that causes widespread panic, or there could be rampant violence in the area that prevents people from going to work for fear of their lives.<ref name="sen development" /> As a result, income inequality increases, and it becomes more difficult to reduce the gap without additional aid.

=== Societal acceptance ===
A 2022 study published in Perspectives on Psychological Science found that in countries where neoliberal institutions have significant influence over policies, the psychology of those population are shaped to have both a higher tolerance of large levels of income inequality, and prefer it over more egalitarian outcomes.<ref>{{Cite web |last=Communications |first=NYU Web |title=Neoliberal Policies, Institutions Have Prompted Preference for Greater Inequality, New Study Finds |url=http://www.nyu.edu/content/nyu/en/about/news-publications/news/2022/may/neoliberal-policies--institutions-have-prompted-preference-for-g |access-date=2023-08-20 |website=www.nyu.edu |language=en}}</ref>

=== Arguments that economic inequality is not a problem ===
The majority of researchers who analyze economic inequality argue that today's levels are problematic and deserve some mitigation.<ref name=Peterson_2017>{{Cite journal |last=Peterson |first=E. Wesley F. |date=December 2017 |title=Is Economic Inequality Really a Problem? A Review of the Arguments |journal=Social Sciences |language=en |volume=6 |issue=4 |pages=147 |doi=10.3390/socsci6040147 |issn=2076-0760 |doi-access=free }}</ref> There are however, some who disagree, and feel that current levels of inequality are necessary because it encourages individuals to gain useful skills and take risks, thereby encouraging growth and innovation, which are necessary for progress.{{ r | Peterson_2017 }} Some have also argued that economic inequality is a natural and fair outcome in market economies, in which the rewards are distributed based on different economic contributions because individuals have different attitudes and talents.{{r|Peterson_2017}} Many who feel that economic inequality is not a significant issue are associated with conservative or libertarian think tanks funded by corporations and the wealthy<ref>{{cite book |last=Stilwell|first=Frank |date=2019 |title=The Political Economy of Inequality|url= |location= |publisher=[[Company:Polity (publisher)|Polity]]|pages=240–241 |isbn=978-1509528653}}</ref> like [[Organization:The Heritage Foundation|The Heritage Foundation]], the Manhattan Institute, the [[Organization:Cato Institute|Cato Institute]] or the American Enterprise Institute, who may also feel that policies which would reduce inequality are direct attacks on their favored version of capitalism, laissez-faire capitalism.{{ r | Peterson_2017 | p=1 | q=While the majority of analysts appear to believe that economic inequality is a significant issue requiring some form of remediation, some disagree. Many of these critics are associated with conservative think tanks such as the Heritage Foundation, the Manhattan Institute, the Cato Institute or the American Enterprise Institute (Furchtgoff-Roth 2014; Mayer 2015; Azerrad and Hederman 2012; Hassett and Mathur 2012). The fact that many of the worries about inequality carry with them implicit criticisms of capitalist economic systems may be one of the reasons conservative writers, who generally favor laissez-faire capitalism, have felt compelled to seek ways to counter arguments about the harmfulness of inequality. Another reason may be the fear that policies to reduce economic inequality may cause significant damage to the economy or to favored groups such as high-income innovators or productive business enterprises. ... Watson (2015), Conard (2016), and Watkins and Brook (2016) see danger in the concerns about economic inequality, arguing that efforts to reduce inequality will cause great harm to economic systems that have brought great prosperity to many. Conard (2016) suggests that high salaries for those at the top provide the incentives for talented individuals to obtain useful skills and to take risks that pay off handsomely for the rest of society. ... According to Mayer (2015, p. 115), “[a] world without wealth and income inequality is in fact a world of universal poverty”. From these perspectives, economic inequality is broadly beneficial because it encourages growth and innovation. }} In addition, some feel that economic inequality has not actually increased significantly.{{r|Peterson_2017}}

==See also==
{{div col|colwidth=22em}}
* Accumulation of capital
* [[Social:Anti-capitalism|Anti-capitalism]]
* Aporophobia
* [[Social:Class conflict|Class conflict]]
* [[Philosophy:Criticism of capitalism|Criticism of capitalism]]
* [[Finance:Cycle of poverty|Cycle of poverty]]
* Donor Class
* [[Medicine:Economic anxiety|Economic anxiety]]
* Economic migrant
* [[Finance:Economic security|Economic security]]
* [[Social:Equal opportunity|Equal opportunity]]
* [[Finance:Great Divergence|Great Divergence]], disproportionate economic advancement of Europe
* [[Engineering:Human Development Index|Human Development Index]]
* [[Finance:Income distribution|Income distribution]]
* [[Finance:Income inequality metrics|Income inequality metrics]]
* ''Inequality for All''
* [[Finance:International inequality|International inequality]]
* [[Finance:List of countries by distribution of wealth|List of countries by distribution of wealth]]
* [[Finance:List of countries by income equality|List of countries by income equality]]
* List of countries by wealth per adult
* [[Social:Occupy movement|Occupy movement]]
* [[Paradise Papers]]
* Poverty reduction
* Public university
* [[Social:Rent-seeking|Rent-seeking]]
* [[Social:Social inequality|Social inequality]]
* [[Finance:Spatial inequality|Spatial inequality]]
* [[Finance:Tax haven|Tax haven]]
* [[Social:Theories of poverty|Theories of poverty]]
* Wealth concentration
* Wealth distribution
{{div col end}}

==References==
{{reflist|30em}}

==Further reading==
;Books
* {{cite book | last1 = Atkinson | first1 = Anthony B. | last2 = Bourguignon | first2 = François |  author-link2 = François Bourguignon | title = Handbook of income distribution | publisher = Elsevier | location = Amsterdam & New York | year = 2000 | isbn = 978-0444816313 }}
* Atkinson, Anthony B. (2015). ''[http://www.hup.harvard.edu/catalog.php?isbn=9780674504769 Inequality: What Can Be Done?]'' Cambridge, Massachusetts: Harvard University Press. {{ISBN|0674504763}}
* {{cite book | last1 = Barro | first1 = Robert J. | last2 = Sala-i-Martin | first2 = Xavier |  author-link2 = Xavier Sala-i-Martin |title=Economic growth |year=2003 | orig-year = 1995 |publisher=MIT Press |location= Massachusetts | edition = 2nd |isbn= 978-0262025539 }}
* {{cite book | last1 = Deneulin | first1 = Séverine | last2 = Shahani | first2 = Lila |  title = An introduction to the human development and capability approach freedom and agency | publisher = Earthscan International Development Research Centre | location = Sterling, VA & Ottawa, Ontario | year = 2009 | isbn = 978-1844078066 }}
* {{cite book | last1 = Giddens | first1 = Anthony | last2 = Diamond | first2 = Patrick |  author-link2 = Patrick Diamond | title = The new egalitarianism | publisher = Polity | location = Cambridge, UK & Malden, MA| year = 2005 | isbn = 978-0745634319 }}
* {{cite book | last = Gilens | first = Martin | title = Affluence and influence: Economic inequality and political power in America | publisher = Princeton University Press Russell Sage Foundation | location = Princeton, NJ & New York | year = 2012 | isbn = 978-0691162423 }}
* {{cite book | editor-last1 = Gradín | editor-first1 = Carlos | editor-last2 = Leibbrandt | editor-first2 = Murray | editor-last3 =Tarp | editor-first3 = Finn| title = Inequality In The Developing World | series = WIDER Studies in Development Economics | publisher = Oxford University Press |url=https://global.oup.com/academic/product/inequality-in-the-developing-world-9780198863960?facet_narrowbypubdate_facet=Next\%203\%20months\&lang=en\&cc=fi$\#$ | year = 2021 | isbn = 978-0198863960 }}
* {{cite book | last = Lambert | first = Peter J. | title = The distribution and redistribution of income | publisher = Manchester University Press Palgrave | location = Manchester, NY| year = 2001 | edition = 3rd | isbn = 978-0719057328 }}
* {{cite book | last1 = Lynn | first1 = Richard | last2 = Vanhanen | first2 = Tatu |  author-link2 = Tatu Vanhanen | title = IQ and the wealth of nations | publisher = Praeger | location = Westport, Connecticut | year = 2002 | isbn = 978-0275975104 | title-link = IQ and the Wealth of Nations }}
* {{cite book | editor-last = Merino | editor-first = Noël | title = Income inequality | publisher = Greenhaven Press | location = Farmington Hills, MI | year = 2016 | series = Opposing Viewpoints Series | isbn = 978-0737775259 }}
* {{cite book | last1 = Page | first1 = Benjamin I. | last2 = Jacobs | first2 = Lawrence R. | title = Class war?: What Americans really think about economic inequality | publisher = University of Chicago Press | location = Chicago | year = 2009 | isbn = 978-0226644554 }}
* Ribeiro, Marcelo Byrro (2020). [https://www.cambridge.org/9781107092532 ''Income Distribution Dynamics of Economic Systems: An Econophysical Approach'']. [https://www.cambridge.org/core/books/income-distribution-dynamics-of-economic-systems/F765B2DB8D01548FE87B6C196E5AD8A2 Cambridge University Press]. {{ISBN|978-1107092532}}.
* {{cite book | last1 = Salverda | first1 = Wiemer | last2 = Nolan | first2 = Brian | last3 = Smeeding | first3 = Timothy M. | title = The Oxford handbook of economic inequality | publisher = Oxford University Press | location = Oxford & New York | year = 2009 | isbn = 978-0199231379 }}
* {{cite book |last=Schmidtz |first=David |title=The elements of justice |year=2006 |publisher=Cambridge University Press | location = Cambridge & New York |isbn=978-0521539364 }}
* {{cite book | last = Sen | first = Amartya |  title = Development as Freedom | publisher = Oxford University Press | location = New York | year = 1999 | isbn = 978-0198297581 | title-link = Development as Freedom }}
* {{cite book | last1 = Sen | first1 = Amartya | last2 = Foster | first2 = James E. |  title = On economic inequality | publisher = Clarendon Press Oxford University Press | location = Oxford & New York | year = 1997 | series = Radcliffe Lectures | isbn = 978-0198281931 }}
* {{cite book |last1=von Braun |first1=Joachim | last2 = Diaz-Bonilla | first2 = Eugenio | title = Globalization of food, and agriculture, and the poor | publisher = Oxford University Press International Food Policy Research Institute | location = New Delhi; Washington D.C' | year = 2008 | isbn = 978-0195695281 }}
* {{cite book | last = Wilkinson | first = Richard G. |  title = The impact of inequality: how to make sick societies healthier | publisher = Routledge | location = London | year = 2005 | isbn = 978-0415372695 }}
* {{cite book | last1 = Wilkinson | first1 = Richard G. | last2 = Pickett | first2 = Kate |  author-link2 = Kate Pickett | title = The spirit level: why more equal societies almost always do better | publisher = Allen Lane | location = London | year = 2009 | isbn = 978-1846140396 | title-link = The Spirit Level: Why More Equal Societies Almost Always Do Better }}

;Articles
* {{cite magazine |last=Ahamed |first=Liaquat |title=Widening Gyre: The rise and fall and rise of economic inequality |magazine=The New Yorker |date=September 2, 2019 |pages=26–29 |quote=[T]here seems to [be] some sort of cap on inequality – a limit to the economic divisions a country can ultimately cope with.}}
* {{cite journal |doi=10.1016/j.jpubeco.2003.07.006 |title=Inequality and happiness: Are Europeans and Americans different? |journal=Journal of Public Economics |volume=88 |issue=9–10 |pages=2009–42 |year=2004 |last1=Alesina |first1=Alberto |last2=Di Tella |first2=Rafael |last3=MacCulloch |first3=Robert |citeseerx=10.1.1.203.664 }}
* {{cite journal | last1 = Andersen | first1 = Robert | year = 2012 | title = Support for Democracy in Cross-national Perspective: The Detrimental Effect of Economic Inequality | url = http://archive.uva-aias.net/uploaded_files/publications/DP47-Andersen.pdf | journal = Research in Social Stratification and Mobility | volume = 30 | issue = 4 | pages = 389–402 | doi = 10.1016/j.rssm.2012.04.002 | access-date = May 12, 2019 | archive-date = June 24, 2021 | archive-url = https://web.archive.org/web/20210624200223/http://archive.uva-aias.net/uploaded_files/publications/DP47-Andersen.pdf | url-status = dead }}
* {{cite journal |doi=10.1111/j.1540-5907.2008.00352.x |jstor=25193859 |title=Economic Inequality and Intolerance: Attitudes toward Homosexuality in 35 Democracies |journal=American Journal of Political Science |volume=52 |issue=4 |pages=942–58 |year=2008 |last1=Andersen |first1=Robert |last2=Fetner |first2=Tina |hdl=11375/22293 |hdl-access=free }}
* {{cite journal |doi=10.2307/2937943 |jstor=2937943 |title=Economic Growth in a Cross Section of Countries |journal=The Quarterly Journal of Economics |volume=106 |issue=2 |pages=407–43 |year=1991 |last1=Barro |first1=Robert J. |citeseerx=10.1.1.312.3126 }}
* {{cite journal |doi=10.1023/A:1009850119329 |title=Inequality and Growth in a Panel of Countries |year=2000 |last1=Barro |first1=Robert J. |journal=Journal of Economic Growth |volume=5 |issue=1 |pages=5–32 |s2cid=2089406 }}
* Cousin, Bruno; Chauvin, Sébastien (2021). [https://onlinelibrary.wiley.com/doi/abs/10.1111/soc4.12883#:~:text=The%20super%2Dbourgeoisie%20would%20be,consciousness%20and%20capacity%20to%20act "Is there a global super-bourgeoisie?"] ''Sociology Compass'' '''15''' (6): 1–15.
* Cousin, Bruno; Shamus Khan; Ashley Mears (2018). [https://academic.oup.com/ser/article-abstract/16/2/225/4978534 "Theoretical and methodological pathways for research on elites"] ''[[Social:Socio-Economic Review|Socio-Economic Review]]'' '''16''' (2): 225–249.
* {{cite journal |doi=10.1080/1354570022000077980 |title=The Human Development Paradigm: Operationalizing Sen's Ideas on Capabilities |journal=Feminist Economics |volume=9 |issue=2–3 |pages=301–17 |year=2003 |last1=Fukuda-Parr |first1=Sakiko |s2cid=18178004 }}
* {{cite journal |doi=10.2307/2297811 |jstor=2297811 |title=Income Distribution and Macroeconomics |journal=The Review of Economic Studies |volume=60 |issue=1 |pages=35–52 |year=1993 |last1=Galor |first1=Oded |last2=Zeira |first2=Joseph |citeseerx=10.1.1.636.8225 }}
* {{cite journal |last1=Goudarzi|first1=Shahrzad |last2=Badaan|first2=Vivienne |last3=Knowles|first3=Eric D. |date=May 10, 2022|title=Neoliberalism and the Ideological Construction of Equity Beliefs|url= https://psyarxiv.com/pc8zy/|journal=Perspectives on Psychological Science|volume=17 |issue=5 |pages= 1431–1451|doi=10.1177/17456916211053311|pmid=35536556 |s2cid=237727224 |access-date=}}
* {{cite journal |last1=Hatch |first1=Megan E. |last2=Rigby |first2=Elizabeth |title=Laboratories of (In)equality? Redistributive Policy and Income Inequality in the American States |journal=Policy Studies Journal |date=2015 |volume=43 |issue=2 |pages=163–187 |doi=10.1111/psj.12094}}
* {{cite journal |doi=10.2307/2296292 |jstor=2296292 |title=Alternative Theories of Distribution |journal=The Review of Economic Studies |volume=23 |issue=2 |pages=83–100 |year=1955 |last1=Kaldor |first1=Nicholas }}
* {{cite journal |doi=10.2753/0577-5132530606 |jstor=27896630 |title=Rising Inequality, Public Policy, and America's Poor |journal=Challenge |volume=53 |issue=6 |pages=93–109 |year=2010 |last1=Kenworthy |first1=Lane |s2cid=154630590 }}
* {{cite journal |doi=10.1177/0094306116681789 |title=Why the Surge in Income Inequality? |journal=Contemporary Sociology |volume=46 |issue=1 |pages=1–9 |year=2017 |last1=Kenworthy |first1=Lane |s2cid=151979382 |url=https://escholarship.org/uc/item/6t26836w }}
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* {{cite journal |doi=10.1177/0263276409350283 |title=Neoliberalism in Action: Inequality, Insecurity and the Reconstitution of the Social |journal=Theory, Culture & Society |volume=26 |issue=6 |pages=109–33 |year=2009 |last1=Lazzarato |first1=Maurizio |s2cid=145758386 }}
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* {{cite journal |doi=10.2307/1884513 |jstor=1884513 |title=A Contribution to the Theory of Economic Growth |journal=The Quarterly Journal of Economics |volume=70 |issue=1 |pages=65–94 |year=1956 |last1=Solow |first1=Robert M. |url=http://rcin.org.pl/Content/39010 |hdl=10338.dmlcz/143862 |hdl-access=free }}
* {{cite journal |last1= Stewart |first1=Alexander J. |last2= McCarty |first2=Nolan |last3= Bryson |first3=Joanna J. |date=2020 |title=Polarization under rising inequality and economic decline |journal=Science Advances |volume=6 |issue=50 |pages= eabd4201|doi=10.1126/sciadv.abd4201 |pmid=33310855 |pmc=7732181 |arxiv=1807.11477 |bibcode=2020SciA....6.4201S |s2cid=216144890 |doi-access=free }}
* {{cite journal |doi=10.1108/03068290310497486 |title=Income inequality between skilled individuals |journal=International Journal of Social Economics |volume=30 |issue=11 |pages=1118–30 |year=2003 |last1=Svizzero |first1=Serge |last2=Tisdell |first2=Clem |s2cid=153963662 |url=http://hal.univ-reunion.fr/hal-02163228/file/Incomeinequalitybetweenskilledindividuals.pdf }}
* {{cite journal |last=Vicencio |first=Eduardo Rivera |title=Inequality, Precariousness and Social Costs of Capitalism. In the Era of Corporate Governmentality |journal=International Journal of Critical Accounting |year=2019 |volume=11 |issue=1 |pages=40–70 |doi=10.1504/IJCA.2019.10025189 |s2cid=211435244 |url=https://www.inderscienceonline.com/doi/epdf/10.1504/IJCA.2019.103833|doi-access=free }}

=== Historical ===
* Alfani, Guido, and Matteo Di Tullio. The Lion's Share: Inequality and the Rise of the Fiscal State in Preindustrial Europe, Cambridge University Press, Cambridge 2019. [https://www.cambridge.org/core/books/lions-share/EF7F07CCC52B674403391EF4BA8384D2 The Lion's Share: Inequality and the Rise of the Fiscal State in Preindustrial Europe]
* Crayen, Dorothee, and Joerg Baten. "New evidence and new methods to measure human capital inequality before and during the industrial revolution: France and the US in the seventeenth to nineteenth centuries." ''Economic History Review'' 63.2 (2010): 452–478.[https://www.researchgate.net/profile/Joerg_Baten/publication/227350073_New_Evidence_and_New_Methods_to_Measure_Human_Capital_Inequality_Before_and_During_the_Industrial_Revolution_France_and_the_US_in_the_Seventeenth_to_Nineteenth_Centuries/links/589dc50992851c7fb4baf1e3/New-Evidence-and-New-Methods-to-Measure-Human-Capital-Inequality-Before-and-During-the-Industrial-Revolution-France-and-the-US-in-the-Seventeenth-to-Nineteenth-Centuries online]
* {{cite book | last = Hickel| first =Jason|  title =The Divide: Global Inequality from Conquest to Free Markets | publisher = W. W. Norton & Company| year =2018 | isbn =978-0393651362}}
* Hoffman, Philip T., et al. "Real inequality in Europe since 1500." ''Journal of Economic History'' 62.2 (2002): 322–355. [http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.824.3130&rep=rep1&type=pdf online]
* Morrisson, Christian, and Wayne Snyder. "The income inequality of France in historical perspective." ''European Review of Economic History'' 4.1 (2000): 59–83. [https://web.archive.org/web/20181119051605/https://pdfs.semanticscholar.org/946b/9a305e390f10186d5d7bf8dc66eb380b6aec.pdf online]
* Lindert, Peter H., and Steven Nafziger. "Russian inequality on the eve of revolution." ''Journal of Economic History'' 74.3 (2014): 767-798. [http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.701.8331&rep=rep1&type=pdf online]
* {{cite journal | last1 = Nicolini | first1 = Esteban A. | last2 = Ramos Palencia | first2 = Fernando | year = 2016 | title = Decomposing income inequality in a backward pre-industrial economy: Old Castile (Spain) in the middle of the eighteenth century | journal = Economic History Review | volume = 69 | issue = 3| pages = 747–772 | doi = 10.1111/ehr.12122 | s2cid = 154988112 }}
* Piketty, Thomas, and Emmanuel Saez. "The evolution of top incomes: a historical and international perspective." ''American economic review'' 96.2 (2006): 200–205. [http://unpan1.un.org/intradoc/groups/public/documents/APCITY/UNPAN027111.pdf online] {{Webarchive|url=https://web.archive.org/web/20111226010420/http://unpan1.un.org/intradoc/groups/public/documents/APCITY/UNPAN027111.pdf |date=December 26, 2011 }}
* Piketty, Thomas, and Emmanuel Saez. "Income inequality in the United States, 1913–1998." ''Quarterly journal of economics'' 118.1 (2003): 1-41. [http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.160.1932&rep=rep1&type=pdf online]
* Saito, Osamu. "Growth and inequality in the great and little divergence debate: a Japanese perspective." ''Economic History Review'' 68.2 (2015): 399–419. Covers 1600–1868 with comparison to Stuart England and Mughal India.
* {{cite book | last = Scheidel| first = Walter |  title =The Great Leveler: Violence and the History of Inequality from the Stone Age to the Twenty-First Century | publisher = Princeton University Press| location =Princeton| year =2017 | isbn =978-0691165028 }}
* Stewart, Frances. "Changing perspectives on inequality and development." ''Studies in Comparative International Development'' 51.1 (2016): 60–80. covers 1801 to 2016.
* Sutch, Richard. "The One Percent across Two Centuries: A Replication of Thomas Piketty's Data on the Concentration of Wealth in the United States." ''Social Science History'' 41.4 (2017): 587–613. Strongly rejects all Piketty's estimates for US inequality before 1910 for both top 1% and top 10%. [http://economics.ucr.edu/repec/ucr/wpaper/201602.pdf online]
* Van Zanden, Jan Luiten. "Tracing the beginning of the Kuznets curve: Western Europe during the early modern period." ''Economic History Review'' 48.4 (1995): 643–664. covers 1400 to 1800.
* Wei, Yehua Dennis. "Geography of inequality in Asia." ''Geographical Review'' 107.2 (2017): 263–275. covers 1981 to 2015.

==External links==
* {{Cite journal|last1=Bowles|first1=Samuel|last2=Carlin|first2=Wendy|title=Inequality as experienced difference: A reformulation of the Gini coefficient|journal=Economics Letters|volume=186|pages=108789|doi=10.1016/j.econlet.2019.108789|issn=0165-1765|year=2020|doi-access=free}}

{{DEFAULTSORT:Economic Inequality}}
[[Category:Economic globalization]]
[[Category:Economic inequality| ]]
[[Category:Libertarian theory]]

{{Sourceattribution|Economic inequality}}