The Reasons for Global Inequality

Which of the following perspectives offers the most convincing explanation for the existence of global inequalities: modernization theory, dependency theory or world-systems theory?

This also incorporates the idea that, “economics equates changes in the happiness of a society with changes in its purchasing power” (Layard, ix). In reality this is completely inaccurate, because quantity of things does not determine happiness. Success is merely a aspect of your status and opportunity, highly correlated with education, and employment status. In addition, some countries incorporate cultures that allow them to adapt and form habits of saving, innovation and hard work. Important differences among nations include the way institutions that regulate the economy and govern the way competition occurs. Most income inequality is between countries rather than within them, because money is distributed equally within every country yet the world's income distributed unequally. These dramatic differences in income levels, reflect both massive productive potential of the capitalist economic system and the uneven distribution of the results of the capitalist economic growth process. The growth and distribution are contingent on institutions that manage the processes of production and pattern of international exchange and

Income Inequality is a major problem that has been going on in America for decades. Many people feel that it barely exists today, but those people are very uneducated and don’t really care about the huge problem in front of them the many people that feel that way are highly uneducated, and seem to not really care about which has been gradually increasing instead of decreasing. Unfortunately, there’s not much that can be done, only of course if the poor class of people decide to actually educate themselves and get a higher education. One says poor class, simply because that’s how they’re classified. There are five types of levels that Americans are classified as, and they are: Upper Class, Upper Middle Class, Middle Class, Working Class, Poor. The highest percentage of Americans fall in the Poor department, and it has been that way for decades, and will continue to be that way for decades to come.

Income inequality is increasingly becoming a significant concern for many countries around the world. The income difference between the highly-educated, skilled, wealthy class and the poor, low to mid-skilled workers is growing larger and larger. In fact, the incomes of the rich are increasing significantly, while the low skilled workers’ incomes have been declining (The Economist, “Wealth Without Workers”). According to The Economist, real median wages have been decreasing since 2000 in half of the member countries in the Organisation for Economic Co-operation and Development (OECD). In the United States, there was a 4% increase from 1980 to 2012 in the share of national income that was distributed to the top 0.01% (The Economist, “True Progressivism”). Canada is facing a similar problem of rising inequality.

We all have different opinions of what the American dream consists of. When the economy was stable, most dreams consisted of having a great career, a big house with all the luxuries imaginable. However, having a stable job, and saving for the future is simply what the American dream has become. Some may argue that the American dream is no longer out there because of the income inequality I assure to all those looking for the dream, inequality has always been there and we should not allow anything to stop us from achieving what we want.

Income inequality has been a major concern around the world, and it mainly links to how economic metrics are distributed among individuals in a country. Economists generally categorise these metrics in wealth, income and consumption. Wilkinson and Picket (2009) showed in their studies that inequality has drawbacks that lead to social problems. This is because income inequality and wealth concentration can hinder or delay long term growth. In 2011, International Monetary Fund economists showed that less income inequality increased the duration of countries’ economic growth spells more than free trade, low government corruption, foreign investment or low foreign debt (Berg and Ostry, 2011).

According to the OECD, the term inequality in the opposite of equity can be defined as evenness

There’s no denying that there are social classes in America. At the top there are the billionaires, and residing at the bottom are those that don’t have a roof over their head. The cause of this huge difference in living is due to income inequality. The gap between the levels is only getting worse. In fact, because of this the middle class is beginning to disappear. However, we can prevent this from happening by placing a strong focus on education, creating more jobs for Americans, and increasing the federal minimum wage.

Economic and income equality have risen significantly in the United States over the years. In 2013, the top 1% accounted for roughly 20% of America’s income, before taxes. According to the Congressional Budget Office, the average income of the top 1% of America’s population has “grown by 275 percent between 1979 and 2007,” even after taxes. In stark contrast, the middle class has experienced growth of about 40 to 60% and the lowest income population has only experienced growth of about 18%. This resulted in the richest households nearly tripling their share of the country’s income while the majority struggled to keep up.

In her piece, “Why Global Inequality Matters,” Nancy Birdsall argues that global inequality is an issue because it can negatively affect the social life, the political process and the economy of countries (especially developing ones). She looks at “how global integration affects poor versus rich countries (and people within countries), and on the resulting limits to poor countries’ (and poor people’s) ability to capture the potential benefits of globalization.” In order to argue her point further, she expounds on why global inequality matters and explores the possible role that globalization may have in perpetuating global inequality. Inequality matters, especially in developing countries with already weak institutions, because it may runs “the risk

We live in a day and age that is immensely affected by wealth distribution and the rapid growth of inequality. With the middle class disappearing as we speak and President Obama’s presidency coming to an end, many are curious about where America is headed next. The Center for Research on Globalization reports that “the yearly income of a US household dropped by a massive 12 percent, or $6,400, in the six years between 2007 and 2013” (Doman). Yet, many Americans remain oblivious to how seriously the economy’s crisis is affecting them and still place hope in the “American Dream”. Meanwhile, the rich continue to gain wealth while the poor are divulging quickly

In theory, globalization should help contribute to the equality of the global economy. Yet this is not the case in reality. Globalization contributes to unsustainable prosperity for a very small percentage of the world’s population. For those in developing countries, it is especially unsustainable. The resources in these areas are consumed at an unstable rate and the environment given very little consideration. The workers are treated as if they are expendable. The smaller economies of these countries are vastly taken advantage of. For these reasons, globalization contributes to sustainable prosperity to a small extent.

Income inequality has affected American citizens ever since the American Dream came to existence. The American Dream is centered around the concept of working hard and earning enough money to support a family, own a home, send children to college, and invest for retirement. Economic gains in income are one of the only possible ways to achieve enough wealth to fulfill the dream. Unfortunately, many people cannot achieve this dream due to low income. Income inequality refers to the uneven distribution of income and wealth between the social classes of American citizens. The United States has often experienced a rise in inequality as the rich become richer and the poor become poorer, increasing the unstable gap between the two classes. UC

Inequality plagues every nation in the modern world. Often times, inequality is addressed by governments in an attempt to ease the tensions between the upper and lower classes, by distributing wealth more fairly. However, their attempts do not always work; unhappiness and discontent begin to appear. Nations, however, must realize that equality cannot be forced, as it is entirely too utopian and isn’t desirable or ideal, since it does not inspire growth or development in the people of a nation. Forced equality is a direct cause of inequality and all of the factors that go along with it, such as social stagnation, constant conflict between social classes, and an unfair nation.

This economic modernization in the Middle East, could only be a short term success which does not guarantee the successful and stable economic development of oil rich states and the region as a whole in the long term. The Middle East, despite its vast reserves of oil, is still considered a developing region due to the high reliance on oil revenues and rather weak production sector of the economy as well as due to some political factors such as lack of democracy, corruption, reluctance to the reforms and other issues. There are various reasons as to why the Middle East is still considered a developing region despite its oil wealth. Natural resource revenues have also been linked to slow economic growth rates, inequality, and poverty. One culprit may be "Dutch disease," which was discussed earlier. Other factors may include the volatility associated with commodity prices, which can have especially negative impacts on weak-state economies; and the underdevelopment of agricultural and manufacturing sectors during boom periods in resource-based economies. And even when oil abundance produces high growth, it often benefits only a few corrupt elites rather than translating into higher living standards for most of the population. Corruption is one of the economic deficiencies which can weaken economic growth and development; thus it is considered as an important impediment to economic growth and political stability, particularly in developing countries. The dependence on a