Economics Notes: Inequality and Poverty
1. Income vs Wealth Inequality
Income Inequality: Uneven distribution of earnings
Wealth Inequality: Unequal ownership of assets (e.g., property, stocks)
2. Measuring Inequality
Gini Coefficient (0 = perfect equality, 1 = total inequality)
Lorenz Curve
3. Absolute vs Relative Poverty
Absolute Poverty: Insufficient income to meet basic needs
Relative Poverty: Income below a certain percentage of median income
4. Causes of Inequality
Education gaps
Wage differentials
Inheritance and asset ownership
Tax systems
5. Effects of Inequality and Poverty
Lower economic growth
Social unrest
Reduced social mobility
Higher crime rates
6. Government Policies to Reduce Inequality
Progressive taxation
Welfare transfers
Public services (e.g., education, healthcare)
Minimum wage laws
