“If you’ve been paying attention to economic controversies in the last decade, you may have noticed many discussions about economic inequality. It’s a hot topic and several people believe that the alleviation of poverty requires a substantial reduction in inequality. For example, Thomas Piketty, the French economist whose book Capital in the Twenty-First Century became a bestseller, understands the distinction between income inequality and poverty but sometimes uses the terms interchangeably, as if one necessarily begets the other. But inequality of income and wealth can remain high or even increase while poverty is decreasing.
“In order to understand economic inequality, we need to ask a few questions. First, are there good kinds of economic inequality and bad kinds? Second, is it a good idea, as many policymakers and even some economists insist, to reduce inequality by taxing those at the top end more heavily? Third, has poverty been increasing? Fourth has economic inequality been increasing”
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