It also causes a nation to not run as a democracy. The United States is already a plutocracy nation because most of the wealth is going to the top of the pyramid and they have the most power to control policies around them. While individuals who are at the bottom are minimum wage workers who don’t have many opportunities to excel in their careers and generate more income. Having a gap between the way wealth is distributed causes health problem for those at the bottom because they have higher levels of stress. It also affects the economy because consumer spending depends on those who are at the bottom end of the spectrum.
Effects of income inequality The impact of economic inequality affects a large part of the population in different ways. The most obvious effects of wealth inequality are that it creates social classes. The first subdivision that we can draw is that population is split in two categories: the rich and the poor. There are a variety of economic effects caused by income inequality. Wealthy people have a higher income and consequently spend less of each marginal dollar, which caused the economic growth to slow.
There are many different kinds of budget expenditures. These expenditures in CareTech Holdings PLS, are mainly associated with health care and social sector and will include budgets like operating, sales and personal and many more. The budget known as the operating budget is responsible in reflecting the services and products which are introduced in the period of budgeting in the service structure. Personal budgets will help in identifying the expenditures incurring in the organization in a period of one financial year. These particular expenses will contain the costs of labor.
Rich and developed countries, on the other hand, have sustained the limit of the population growth. Controlling the population means two opposite things, the effort to increase or decrease the number of people in each and every country. In countries which lack development and where a very high rate of poverty is present, control of the population is a necessity, and poverty has a direct relation to population growth. It cannot be automatically stopped or completely prevented, and when it grows, there are chances of high competition among the members of the population, leading to war or disputes between countries and thus, reducing the total number
The article draws from references as studies done by the Organization of Economic Cooperation and Development (OECD) on the how the measure of wealth inequality between the richest nations is exceedingly high and may eventually lead to economic stagnation and slower economic growth in a nation’s economy. The article states that the top 20 percent of the population of the United States own eighty nine percent of net worth in the country, while the bottom 40 percent own less than a percent of net worth. Net worth in the article is defined as the total value of assets after the total value of liabilities is subtracted. I will explain how social stratification between the top twenty and bottom forty percent is caused by wealth inequality through four key sociological theories and concepts. Analysis A: In the Structural Functionalist perspective both groups are interdependent, meaning one group cannot exist without the other.
Global income inequality: When compared to other nations, the U.S. is one of the richest despite the severe income gap among its own citizens. Although many U.S. citizens are classified as low-income, their wages are still a great deal higher than citizens from poorer countries. Most of the world’s top 1% live in the U.S., increasing the overall national average income. Global inequality is also seeing a decline as developing nations develop and become industrialized. In spite of growing populations, especially in underdeveloped countries, the economic growth brought on by industrialization has helped many families escape living in poverty.
According to ⦁ niche.com, the top few cheapest cities (in terms of basic expenses) of the States to live in are - Fort Wayne, Toledo and Wichita. ⦁ On the flipside, it might also help to live around the suburbs of a city that pays very well. The top wage-earning cities in the US range from New York City, San Francisco to Boston. Time Magazine proposed the above statistic which reflects the cities in the United States with the highest minimum wage. Living around the suburbs of these cities would mean that one can make huge earnings while saving on expenses like food, entertainment and exorbitant rent.
The housing market is a key issue. With various price rises in renting of houses, consumers have found it harder to afford such places of shelter; the cost of standard living is expensive, Take Bermuda for example. its cost of living index amounting to 133.68. (Jones C. 2017). Will the government intervene once again and restore parity to cost of common residences?
That someone working forty hours a work could be so securely bound by poverty is unbelievable and unacceptable. Such scenarios, which afflict millions and millions of people, appear to violate the so-called “social contract” of the American Dream (Source 2), which posits that working hard guarantees a comfortable life with decent housing and basic necessities. Such a fancy is belied by the harsh reality of the minimum wage. Even progressive attempts to elevate the national minimum wage to $10.10 leave earners with a hourly salary with buying power “lower than what” $1.60 was worth in 1968 (Source 4). Here, the minimum wage is actually working against its goal; rather than providing a livable baseline wage to subsist upon, the minimum wage standard is being used as a lever for exploitation, with employers steadfastly refusing to pay much more than the merest amount legal.
DISADVANTAGES Long term financial development puts an awful effect on the inhabitants of any nation. Long term economic developments may be identified with expansion, as inflations may increase. Inflations usually increase the cost of products on sale, and as the costs are higher, it will be an issue to the nationality in question to be able to buy their needs There is a limited amount of time involved in the growth of an economy as it involves an increase in GDP. The hypothesis and practice are both diverse. The hypothesis is the thing that economists are able to figure out for themselves; however, to be able to use the hypothesis in reality is the main task.