Inequality Flashcards
For uk direct tax rates in 1979
33%
83%
Uk indirect tax in 1979
8%
Uk direct tax in 2019
20%
40%
45%
Indirect tax in 2019 uk
20%
When was national minimum wage introduced
1998
Gender inequality
The gender differences in pay are not due to differences in cognitive abilities or quality of schooling
Intergenerational inequality
Inequality can come with what is inherited. You may be rich or poor because your parents where rich or poor
Intergenerational elasticity or mobility
Refers ti the processes by which the economic status of the adult sons and daughters come to resemble the economic status of their parents.
Earnings distribution
Top 0.1% = 1,000,970
Top1% = 271,888
Top10% = 100,000
90% = 12,050
Lorenz curve measuresthe
Gini coefficient
Gini coefficient
100= total inequality
0= total equality
Problems with redistribution
Those with higher incomes have a tendency to save more of their income. Therefore if higher earners are taxed to much then there will be less savings for investment
Not all extra consumption by those on lower incomes will be purchased on uk goods. It is likly that a fair proportion will be spent on imports leasing to a greater balance of payments deficit
Higher tax can be seen as disincentive to work
Higher levels of benefits can be seen as a disincentive to work
Positive of redistribution
Schools lunches free p1- p5
<22 free bus pass and >60
No prescription charges
Scotland tax rates
0%
19%
20%
21%
42%
45%
48%
Us Uk and germany gini
US 48.27
UK 33.7
Ger 34.04
3 ways the govt helps
Tax
Benefits
Minimum wage
Absolute poverty
Attaining a certain basic standard of living, unable to afford basic goods and services
Relative poverty
A widening gap between rich and poor
Social exclusion
Where the existence of poverty is denying opportunities to those it affects
4 policy tools
Govt spending
Tax and income and wealth (CGT and IHT)
The levels of benefits
Tax credits
Social welfare stats to measure the quality of life
Divorce rates
Crime rates
Tge no. Of patients per doctor
The proportion of the population that can read or write
Causes of poverty
Unemployment
Changing patters of demand for labour
Lack of education or qualifications
Single parenthood
Income tax cuts (45% used to be for 150,000 but not 125,000)
Types of unemployment
Frictional= occurs when people are switching between jobs; either because they have been made redundant or are looking for new employment
Cyclical = associated with a recession with a recession/ falling economic growth
Aggregate demand falls for all products so businesses reduce staff and there no longer enough jobs for those seeking them.
Seasonal = industries such as agriculture, tourism and building where the number of employed changes depending on the time of year
Effects on unemployment individuals
Reduced income and standard of living
Reduced status - social exclusion
Reduced efficiency as the unemployed lose skills
Increased mental and physical health
