Why is it not enough to look at income inequality when analyzing the effects of economic policies?
Responses
erobinovitz
Because these reforms have also elevated billions of people out of poverty
Posted
Jun 27, 2020
daniel.stalling7_434612
Most of the diagrams used to display inequality are like strait up and down skyscrapers. The effect is really more like a pyramid. As people, and institutions, accumulate wealth, they increasingly require support systems that employ people. Wealth becomes distributed (if somewhat unevenly) throughout the economic system. This increases economic opportunity for large numbers of people who otherwise would continue to be impoverished.
Responses
Because these reforms have also elevated billions of people out of poverty
Most of the diagrams used to display inequality are like strait up and down skyscrapers. The effect is really more like a pyramid. As people, and institutions, accumulate wealth, they increasingly require support systems that employ people. Wealth becomes distributed (if somewhat unevenly) throughout the economic system. This increases economic opportunity for large numbers of people who otherwise would continue to be impoverished.