Day 9: Income Inequality

There is a significant disparity of wealth distribution called income inequality. This occurs due to the nature of economic growth within different social groups. With a high density of wealth accumulating within the very small top end of the social spectrum. This causes a large divide, with a minute portion of the population have a very large percentage of wealth. This trend is very prolific in western countries such as the United States and the United kingdom. As shown in the graph below, over 17% of the income in the US is held by the top 1%.

While there are notable benefits to this distribution of economic assets; it provides an incentive for innovation and allows more market dominance on an international level. However there are also some sever drawbacks to this disparity. Lack of wealth in lower social groups can cause higher crime rates, poorer public health (unable to afford) and lower education levels. However probably the most significant affect is the slowing of long term GDP growth rates. So for society, this inequality is detrimental and results in lower quality of life for a large portion of the population.