China Income Inequality

Income inequality has been a major issue in American history. There are many different factors that contribute to inequality. These include education, wealth, discrimination, ability, and monopoly power.

In China on the other hand, the distribution of income has been unfairly distributed. China’s poorer residents have benefited more compared to the wealthier residents. This rise in income inequality began when former leader

Societies and their governments have developed different policy approaches to addressing domestic inequality. Compare and contrast two different countries and evaluate the effectiveness of their key policy measures in addressing inequality.

Gan, Li, et al. "Reducing Inequality: Taking From The Top To Distribute At The Bottom." China Perspectives 2013.3 (2013): 80-82. Academic Search Complete. Web. 29 Oct. 2015. Gan et al. examine the true scope and detail of the income disparity present in contemporary Chinese society. This work examines the introduction of government measures, the criticisms and inadequacies of these supposed measures, other potential solutions that have been proposed, as well as whether or not the Chinese government has the true ability and willingness to carry out the new

Why is income inequality an important issue for the Chinese society and its future economic growth?

Increased income inequality is shown to increase the poverty rate. This is shown as more income moves apart from lower income brackets to upper income brackets. The Economic Policy Institute estimated that increased income inequality has increased 5.5 percent in from the year 1979 to 2007. This increase in poverty is reflected directly from income inequality as the bottom laborers in a business are working harder and gaining less, as the top workers, the CEO’s, and other executives are spending less time working, and more time counting their money. Income deprivation has been the largest driver of change in poverty rate, much above other factors such as economic growth, education, and race.

Living with a poverty level income is a difficulty facing many people around the world; poverty is a cultural universal, or trait found in every known culture – not an expression of individual differences. The most basic explanation for this is the trend towards social stratification, the system by which society organizes itself into a hierarchy. In some cultures this is manifest in the form of a caste system in which people who are in poverty have little to no chance of escaping it. In the United States the system is more in the form of a class system in which there is at least some degree of social mobility, and less status consistency allows people in poverty to have the possibility of changing their social status, but rarely the

In recent years, a growing gap between the wealthy and the middle class has grown, as the wealth of the world has increased significantly, yet only a minority of individuals get to enjoy it. Income inequality has been proven to be detrimental to not only the economy, but to the overall well-being of a nation as it leads to societal upset and can potentially prompt a decline in progression as a nation. Over time, income inequality has led to negative results in the United States, as well as many other nations including Greece. Consequently, the solution to prevent income inequality from deteriorating a nation and prevent economic upset is to ultimately tax those who are wealthier at a higher rate and put said money towards education and healthcare

The gaps between the poor and the risk, as well between rural and urban are getting wider and wider. According to official Chinese government statistics, on average, urban incomes are four times that of rural areas. This is very problematic for social cohesion. These cause a large population of labors forces rushed into urban areas to make a living. They are termed as floating populations. Official statistics estimated the number of these migrant workers is between 70 to 120 million. When the urban areas are reaching saturations, migrant workers move further to earn money – some of them keep moving to other cities, the rest may choose to stow

Whether or not one agrees with the economist’s observation on measuring poverty through the income, the analytical problem that is demonstrated is the lack of income can prevent individual from accessing fundamental needs for minimum standard of well being. In areas where individuals have very low wages, inflation causes the area to fall deeper into poverty. Inflation is defined as a general increase in prices, not minimum wages. Therefore, understanding the measurements of poverty can led to exploring sufficient solution to help decline the poverty level in rural areas.

Statistics indicates a rise in poverty levels in most countries all over the world. In America, more than 15% of the population lives in poverty and deplorable living conditions. Poverty and homelessness are particularly high amongst children living in the United States. Poverty is considered as the inability to meet one’s basic needs due to lack of money. It is state of deprivation in which a person lacks and is unable to acquire the normal monetary sum or property and other possessions. In the United States, the poverty threshold is used by the government to measure the level of poverty in the country. The government implements different policies and programs to eradicate poverty depending on the level of poverty. The policies and programs are meant to improve the welfare of the poor in the society and enable them to improve their social status. This paper will entail research on poverty and the policies and programs implemented to eradicate poverty in the United States.

There are a number of reasons for studying the economic consequences of income inequality (see~\cite{dabla2015causes} and~\cite{bertola2014income}). Inequality of outcomes and opportunities in an intergenerational context is discussed by~\cite{black2015poor}, where they give evidence that wealth begets wealth. Inequality of opportunities can result in large social costs, as it can compromise individual's educational and occupational choices.~\cite{stiglitz2012price} also mentions the incentives people have to divert their efforts toward securing favored treatment and protection under such unequal society, resulting in corruption, nepotism and ultimately weakening the confidence in institutions. Besides, empirical evidence sugests there are

Financial loss, divorce, long commute times can befall a person because of the rapid growth of income inequality. But one mustn’t look at statistical analytics to see the reasons behind the falling outs but rather at what causes do these people not have higher incomes, marriage and living problems. These persons undoubtedly make bad decisions in their homes and work place-they may be very rude to clients, don’t take their job seriously, or are unorganized individuals-and therefore may be fired for their behavior and must take on a reduced income at a measly job because nobody else will accept them. They carry all of their problems

In any given population, there is a difference between what people within the population earn. The uneven distribution of income in any given population is income inequality. In order for there to be income, there has to be several sources of income. These sources of income may be combinational or independent per person receiving the income. Income may result from wages, rent, bank account interests, salaries or even profits made in business transactions ( Stiglitz, 2012).

Poverty traps are economic anomalies that continually reinforce poverty within a country’s, or multiple countries’, economies. There are many different types of poverty traps such as savings traps, “big push” models, nutritional traps, behavioral traps, geographic traps, etc. that all affect an economy in different ways. Not only can poverty be enforced through these traps, but also through the way an economy is run or the moralities of the government. According to Mark Koyama (2015), poverty traps are important due to more than 3 billion people, nearly half the world’s population, living on less than $2.50 per day, and about 1.3 billion people living in extreme poverty on just $1.25 per day. Among these 3 billion some people living in poverty, one billion of them are children of which thousands are dying daily. It is necessary to study these different poverty traps in order to begin to decrease the distressingly high percentages of people living in poverty.