Please Use Scholarly Resources To Research Changing Rates Of
Please Use Scholarly Resources To Research Changing Rates Of Income
Please use scholarly resources to research changing rates of income inequality in the U.S and answer the following questions: Since the post WW II period, how have rates of income inequality, meaning the income gap between the high earners and low earners as well as between population quintiles, changed and what has contributed to these shifts? Please write a one to two page single spaced response. Please cite all your sources APA style and turn the assignment into the dropbox. One place to begin looking is on the Census Bureau's website. Note: Selecting this link will open a new window with content that is outside Rutgers University. Neither Rutgers nor Pearson sponsors or supports the content found on this site. Students may also find that the social work policy research guide is helpful. Students should cite a minimum of three scholarly sources.
Paper For Above instruction
The post-World War II period in the United States has been marked by significant shifts in income inequality, characterized by a widening gap between high earners and low earners. Understanding these changes requires examining the historical trends, contributing factors, and the implications for social and economic policy.
Historical Trends in Income Inequality Post-WWII
After World War II, the U.S. experienced a period of relative income equality, largely attributed to policies that promoted economic growth and income redistribution, such as progressive taxation, union strength, and government social programs. During the 1950s and 1960s, income inequality was relatively low, with the Gini coefficient—a standard measure of income disparity—remaining stable and modest (Milanovic, 2016). However, starting in the late 1970s and into the 1980s, income inequality began to increase markedly. This trend accelerated through the 1980s and 1990s, reaching levels not seen since the Great Depression, with the top 1% of earners collecting a growing share of total income (Piketty & Saez, 2003).
Contributing Factors to Rising Income Inequality
The rise in income inequality can be attributed to a confluence of economic, policy, and technological factors. Firstly, the decline of labor unions has weakened workers’ bargaining power, leading to stagnating wages for low- and middle-income workers (Jacobs & Skocpol, 2012). Concurrently, globalization has shifted manufacturing jobs overseas, reducing job stability for many American workers and placing downward pressure on wages across sectors. Another critical factor is technological change, especially automation and information technology, which has increased demand for high-skilled workers while displacing routine jobs (Autor, 2014).
Tax policies have also played a role; tax cuts for the wealthy, beginning with the Reagan administration, have reduced fiscal redistribution, allowing income to concentrate among the top earners (Saez & Zucman, 2019). Moreover, the rise of financialization—the increased dominance of financial motives, financial markets, and financial actors—has disproportionately benefited the wealthiest individuals who hold significant financial assets (McKinsey Global Institute, 2018).
Impacts on Income Distribution and Socioeconomic Inequality
These shifts have resulted in a greater disparity between the top quintile and the lower quintiles. Data from the U.S. Census Bureau reveal that the income share of the top 20% has increased substantially, while that of the bottom 20% has decreased (DeNavas-Walt & Proctor, 2015). The disparity is also evident in the growing wealth gap, with the wealthiest households holding an outsized portion of total wealth. This growing inequality has social and economic implications, including reduced social mobility, increased poverty rates among the lower quintiles, and amplified political polarization (Corak, 2013).
Conclusion
In sum, the period following World War II has seen a dramatic transformation in income inequality in the U.S., characterized by a widening of the income gap driven by declining union power, globalization, technological advances, and policy shifts favoring the wealthy. Addressing this disparities requires comprehensive policy measures promoting equitable growth, such as strengthening worker protections, reforming tax policies, and investing in education and technology to bridge the income gap.
References
Autor, D. H. (2014). Skills, education, and the rise of earnings inequality among the 'other 99 percent'. Science, 344(6186), 843-851.
Corak, M. (2013). Income inequality, equality of opportunity, and intergenerational mobility. Journal of Economic Perspectives, 27(3), 79–102.
DeNavas-Walt, C., & Proctor, B. D. (2015). Income and Poverty in the United States: 2014. U.S. Census Bureau.
Jacobs, R., & Skocpol, T. (2012). The Social and Economic Roots of Income Inequality in America. Annual Review of Sociology, 38, 43-66.
Milanovic, B. (2016). Global Inequality: A New Approach for the Age of Globalization. Harvard University Press.
McKinsey Global Institute. (2018). The Power of parity: How advancing women’s equality can add $12 trillion to global growth.
Piketty, T., & Saez, E. (2003). Income inequality in the United States, 1913–1998. The Quarterly Journal of Economics, 118(1), 1-41.
Saez, E., & Zucman, G. (2019). The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay. W. W. Norton & Company.