EC120 Lecture Notes - Lecture 20: Invisible Hand, Unemployment Benefits, Welfare Trap
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EC120 Full Course Notes
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Income inequality and poverty: diferences in equilibrium wages result from diferences in: Does not necessarily ensure that resources are allocated fairly. Deining poverty in canada: low-income cutof (lico): the level of income at which a household of a given size in a community with a given populaion spends 20% more than average on food, shelter, and clothing. Canadian families spend on average 43%, families that spend more than 63% Some people advocate the use of an absolute measure of the poverty line (such as the cost of acquiring needs) How do you deine basic needs (deiniion is subjecive) In-kind transfers: assistance that takes the form of goods and services rather than cash. Omited from measures of inequality and poverty, biasing them upward: the economic life cycle. The economic life cycle: the regular patern of income variaion over a person"s life. People can borrow and save to ofset life-cycle changes in income (saving for reirement)
