Studied by 12 people
higher poverty
larger share of top 1% in the country
extent of relative poverty
increased by 6 millions since 2008; 25% of EU; 45 million of Americans
income inequalities between countries are less concerning than
income distributions within countries
equality of opportunity
prerequisitional circumstances do not matter in the determination of the outcomes
ex-ante concept
judged "before the event"
equality of outcomes
outcomes today determine opportunities tomorrow
ex-post concept
judged after the action had been taken
equality of opportunity provides a 'level playing field'
not that each person has an equal chance to succeed, but that everyone 'plays' by the same set of rules
intergenerational earnings elasticity
model that captures the statistical connection between parents’ income and their children’s income in later life; higher coefficient means lower intergenerational mobility
components of income
individual earnings, capital incomes, transfers, disposable income, 'living standards'
capital incomes
dividends/interests on savings accounts/shares
transfers (in income)
reassigning ownership of monetary funds/assets to a new owner/acount
household market income
earnings of person 1 + earnings of person 2 + income from capital
private transfers
what level concept are earnings and income on
earnings - individual level, income - household level
household disposable income
household market income + state transfers - direct taxes
household equivalised disposable income
household disposable income divided by the number of equivalent adults
household extended income
household equivalised disposable income + value of public goods(health, education, social care)
needs-based justice
making sure that everyone is able to fulfill basic needs and participate in the society(but doesn't consider non-material welfare like autonomy) -> unconditional basic income
perfomance-based justice
earnings should be based on contribution(hard to measure objectively)-> Austrian pension scheme
market-based justice
“objectivity-assessment” is made by the market -> wage equals marginal productivity
justice of opportunities
same intial starting points -> positive discrimination
participatory justice
same chance of participating in the society -> equal access to services and infrastructure
90/10 income ratio
compares the two extremes of income distribution(richest and poorest)
90/50 income ratio
compares incomes of richest to middle class
50/10 income ratio
distribution of income among relatively poor population
mean income
total income divided by number of groups
median income
number in the middle of income distribution
endogeneous fiscal policy
inequality leads to political discontent -> re-distributive policies that harm growth
human capital accumulation theory
poor people aren't able to invest enough in their education
declining incomes of the poor together with higher income shares of the rich result in...
lower aggregate demand (rich people have a lower propensity to consume and may save rather than re-invest money)
OECD study
most up-to-date data and methods; strong negative link between inequality and growth; works through human capital accumulation channel
status anxiety
income inequality places people into status competition and causes stress
“keeping up with the Joneses”
low position in social status hierarchy is stressful to most people
social evaluative threat
if people are made even subtly aware that they belong to a group regarded as performing poorly in the test areas, they perform worse than if they are not been made aware
race between educationa nd technical change
abstract tasks done by 'educated' people cannot be easily replaced by technology
routine tasks replaced by computers lead to ...
squeezing of the middle skill(income) jobs
division of surplus between wage and profit is determined in part by ...
the relative bargaining power of two parties
social, fiscal, and union pressure after WWII meant that
high wage earners were simply unable to increase their salaries back to pre-war levels while those at the bottom did rise
winner-takes-all markets
globalization means bigger markets, profits and incomes; CEO's pay related to company performance
emissions by top 10%
half of world individual emissions
emissions of bottom 50%
12% of world emissions
Note
Flashcard