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Income inequality and poverty in the USA.
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THE RISING INCOME INEQUALITY AND ITS EFFECTS IN USA.
Utsav Sachdev
Broward College
ECO 2013
Professor Srabana Gupta
ABSTRACT
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Income inequality and poverty in the USA.
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This paper gives a brief overview of income inequality and poverty in USA. We first discuss the
concept of income inequality and how it is measured. Further on, the definition of poverty is
given followed by different types of poverty. The rising income inequality in the USA is
explained from the 1970’s to 2015. The income share among the people is shown with data. It
shows the difference in income among different income groups in the economy. Talking about
the effects of income inequality, poverty is discussed. Data related to poverty is studied for
different races in the society and the general population as well. This paper answers all the
research questions proposed related to income inequality and poverty. This paper also talks
about the poverty rate in some of the states of USA…
INTRODUCTION
Definition of Income inequality-
Income inequality is the income gap between the individuals and households making the most
of the total income and the individuals or households making very little of the total income.
Income inequality is the income gap between the richest and the poorest in an economy. This
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Income inequality and poverty in the USA.
inequality has various effects on the economy and the increase in this inequality can have
harmful effects on socio-economic factors, economic and political factors of the country.
Income inequality is measured by various ways. One of the simple ways is to divide the
population in five parts (quintiles) from the poorest to the richest. We then review the levels or
proportions of income shared by each group. According to Wikipedia, Gini coefficient is a
statistical measure of the degree of variation represented in a set of values, used especially in
analyzing income inequality. Gini coefficient of inequality is one of the most common measure
used to calculate the income inequality. Other common methods of calculating the inequality
are by using decile dispersion ratio, generalized entropy measures and Atkinson’s inequality
measures.
