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Chapter 3 Unit 6

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SiLLa ÀntoNy
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4 views

Chapter 3 Unit 6

Uploaded by

SiLLa ÀntoNy
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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ADDRESSING

INCOME AND
WEALTH
INEQUALITY
DISCUSS

• To what extend is there inequality of


income and wealth in your own
country?
• How could government and the
international do more to reduce
inequality in income and wealth?
2
WHAT IS INCOME?
• Reward for the
services of a factors
of production.
• Labour – wages,
salary and bonus
INCOME • Other factors of
production – rent,
AND interest and profit.
• Income is a
WEALTH concept
flow

3
WHAT IS Wealth?
INCOME Stock of assets
someone had built
AND over time
GUESS THE
WEALTH EXAMPLES?
4
THE TOP 10 RICHEST PEOPLE IN ASIA
MEASURING INCOME AND WEALTH
INEQUALITY
GINI
COEFFICENT
• Numerical measure of the extent of income
inequality in the economy
• Equal income distribution = 0
• If income accrues to just one person = 1
If Gini coefficient is 0.3 for country A and 0.5
for country B, then which country has more
equal distribution of income?

6
ECONOMIC REASON FOR INEQUALITY
OF• INCOME AND WEALTH

•
•
•
•
•
•
7
ECONOMIC REASON FOR INEQUALITY
OF• INCOME AND
Lack of formal WEALTH
employment opportunity
• Poor vocational training
• Lack of investment in education and health
sector
• Poor infrastructure
• Low rate of saving
• Inability to obtain credit

8
MEASURES TO REDUCE INEQUALITY OF
• INCOME AND WEALTH
•
•
•
•

9
POLICIES OF REDISTRIBUTION OF
INCOME AND
• Minimum wageWEALTH
rate

• Transfer payment
• Progressive income tax, inheritance and
capital tax
• State provision of essential goods and
services

10

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