To understand the causes of inequality one must first know what inequality is. Inequality is the extent to which income is distributed unevenly in a group of people. It is the disproportionate ownership of resources between different sections of the society. Inequality is typically thought of as differences between individuals within a population, normally a country, though it can also be considered for smaller or larger populations. Thus it is important to consider inequality between groups of people, including global inequality between countries, inequality between regions or communities within a country, and inequality between groups of individuals or households classified according to various criteria (for example gender, class). Inequality …show more content…
This is probably related to reason one: the level of education is often proportional to the level of skill. With a higher level of education, a person often has more advanced skills that few workers are able to offer, justifying a higher wage. The impact of education on economic inequality is still profound in developed countries and cities. Although there are usually policies of free education in developed nations, levels of education received by each individual still differ, not because of financial ability but innate qualities like intelligence, drive and personal ability. Moreover, receiving the same level of education does not mean receiving education of the same quality. This accounts for the difference in abilities and hence wages for individuals all receiving, for example, 12 years of education. Therefore, it seems no matter how good the social welfare policy of a country is at preventing denial of education due to financial difficulties, differences in education, in terms of levels and quality, still play a prominent role in economic …show more content…
They are: private ownership of poverty, domination of rich classes, concentration of economic power, the law of inheritance, faulty taxation system, credit policy and so on. Inequality is a vicious circle. “The rich get richer; the poor get poorer” .The concept behind it is a theoretical process called “wealth concentration.” Under certain conditions, newly created wealth is concentrated in the possession of already-wealthy individuals. The reason is simple: People who already hold wealth have the resources to invest or to leverage the accumulation of wealth, which creates new wealth. The process of wealth concentration arguably makes economic inequality a vicious cycle. The effects of wealth concentration may extend to future generations. Children born in a rich family have an economic advantage, because of wealth inherited and possibly education, which may increase their chances of earning a higher income than their peers. These advantages create another round of the vicious