Economics 1021A/B Lecture Notes - Lecture 12: Lorenz Curve, Proportional Tax, Gini Coefficient

• School: Western University
• Department: Economics
• Course: Economics 1021A/B
• Professor: Michael Parkin

Document Summary

Both wealth and income are distributed unequally, but wealth inequality is much greater than income inequality. Poorest 20 percent earned 5% of total income. Poorest 40 percent owned 1% of total wealth. Sources of economic inequality: human capital, discrimination, unequal ownership of capital. Job conditions: regional disparities, market power (unions, discrimination. The more human capital a person possesses, the more that person earns, everything else being equal. Years of schooling (in recent years, a median of 12. Number of job interruptions years for both sexes) Families must choose how to allocate the time of their members between paid work outside the home and domestic production. One partner may specialize in earning income, and the other may diversify: working part-time outside the home, and part-time at home with children. Traditionally, men have specialized, whereas women have diversified. This specialization has improved husbands" earning power: men have had more opportunity to acquire human capital.