Income Inequality, Poverty And Discrimination In Today's Society

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Discrimination in Today’s Society Income inequality, poverty and discrimination are issues that the United States is currently facing. The United States is among one of the countries that have the highest average household income, however this does not accurately represent each household. Data shows that there is significantly less income inequality over a longer period of time rather than in a single year because income mobility is more substantial over time. The more period of time that is considered for an individual, the more equal the distribution of income becomes. Government taxes and transfer significantly reduce income inequality by redistributing income from higher income groups to lower income groups. There is no simple way to explain why some individuals have more income than others. Some factors that explain why income inequality exists include: ability, education and training, discrimination, preference and risks, unequal distribution of wealth, market power, and luck/connections/misfortune. Abilities and skills vary from people to people that allows individuals to be successful …show more content…

Statistical discrimination involves the judgment of people bases on average statistical characters of the group rather than the productivity or efficiency of that individual. This belief in the labor market may lead to profitability but fails to address the worker’s skills/abilities and limits their opportunities. Occupational segregation implies that women and minority groups are crowded into minor quantity of occupations. The supply of workers is larger than the demand for the workers consequently their wages and income are lower in crowded jobs. Not only does discrimination affect individuals because it results in lower wages and few opportunities but it also affects the economy because it leads to a reduced total output and creates false barriers for

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