According to most conventional measures, income inequality in the developed world has been rising. This trend has been argued to be particularly prevalent in the UK and USA, but the article below from The Economist argues that conventional measures may be mis-representing the differences between the better off and the less well off. Instead of looking at income inequality, it looks at consumption inequality.
The new (improved) Gilded age The Economist (19/12/07)
|1.||Define the terms (a) income inequality and (b) consumption inequality.|
|2.||Assess the extent to which income represents a good measure of economic wellbeing.|
|3.||Discuss two policies that could be used to reduce (a) income inequality and (b) consumption inequality.|