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Income And Wealth Inequality

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Sociology
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Rice University
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1. Describe what income and wealth inequalities are like in the U.S at the present time.
According to Pew Research, income inequality in the United States is the highest among
the G7 nations. Although there has been a consistent rise in income and wealth levels of
individuals in the United States the inequality has been consistent and this is seen in both gender
and race. In the present time, there is too much economic inequality with upper class citizens
making up about 27% and middle and lower income making up 25% and 18% respectively. Over
the last decades, inequality has been realized in the U.S. across income groups. The upper class
constitutes around 27%, and Americans of the middle class constitute about 25%, and the lower
class represents the largest proportion of approximately 18%. The wealth gap between the
American richest and American poorest has more than doubled. Currently, the richest 5% of
families hold about 248 times much wealth at the median. This is an indication that the wealth
gap has continued to expand over the years. From the racial perspective, black-white income gap
has persisted overtime. Currently the median black household income is 61% of median white
household income. This indicates about 56% increase from 1970.
2. Explain why the income and wealth gaps in the United States Have grown in recent
decades, using the key trends and examples from “heist: who stole the American
Dream?” and our class discussions.
The rise in income and wealth gap in the United States in recent time has been attributed
to several factors. The three notable factors that have facilitated in the rise of this gap include
falling wages and rising income inequality, technology, trade and institutions. The falling labor
force participation, stagnation median wages, as well as declining share of labor income have
been significant contributors of the growth of income and wealth gap in the United States. With

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the adoption of modern technology and education, many companies have adopted high
technology, which reduced the human labor requirement in the industries. This led to the
retrenchment of many workers in manufacturing jobs. In the recent past, the United States lost
around 46% of the factory jobs, and on education, Americans with high educations have higher
skills and chances to acquire well-paying jobs. Increased household debts and lower tax rates on
high incomes; increased the chances of the financial crisis in the long run. The United States tax
system is taxing less on the high-income earners. This causes a greater gap of inequality between
the upper, middle, and lower classes. Lastly, trade and globalization led to increased imports into
the United States, leading to job loss from the American industries producing the goods being
imported from other trading partners.
3. What has this growing inequality done to the middle-class in the U.S. and why is this
concern to most sociologists? Be sure your response covers the key economic,
political and cultural processes that have Exacerbated social inequality
The rising income inequalities has led to slower growth in educational attainment as well
as increased disparity in human capital accessibility. This inequality has also resulted in
shrinking middle class. This is because with the shrinking middle class, families in return do not
have access to enough resources to invest in human capital. It should be noted that the middle
class incubates entrepreneurial skills and with the shrinking middle class, there is a concern for
the country’s entrepreneurial future. Most importantly, a strong middle class supports inclusive
political and economic institution and with the shrinking of this class, there is concern for the
future economic growth of the country.

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1. Describe what income and wealth inequalities are like in the U.S at the present time. According to Pew Research, income inequality in the United States is the highest among the G7 nations. Although there has been a consistent rise in income and wealth levels of individuals in the United States the inequality has been consistent and this is seen in both gender and race. In the present time, there is too much economic inequality with upper class citizens making up about 27% and middle and lower income making up 25% and 18% respectively. Over the last decades, inequality has been realized in the U.S. across income groups. The upper class constitutes around 27%, and Americans of the middle class constitute about 25%, and the lower class represents the largest proportion of approximately 18%. The wealth gap between the American richest and American poorest has more than doubled. Currently, ...
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