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Contributors to America's Economic Inequality

Updated: Nov 21, 2021

What do you think contributes to the economic inequality in America?


The public: based on a survey (1) of American adults conducted Sep.16-29, 2019, about 45 out of 100 Americans believed that outsourcing of jobs, the tax system, and problems with education are the major causes of income and wealth disparity in the country. Slightly fewer people thought that personal choices, starting out with more opportunities, and not enough regulation of major corporations are some of the big factors.


The experts: according to an article(2) by CNN journalist John Harwood published on CNBC in June 2019, scholars identified five contributors to the economic inequality:

  1. Technology change—computer software and industrial machines eliminated the so-called “middle-skills” jobs.

  2. Globalization—jobs in manufacturing moved to China due to the country’s lower cost and skilled labors.

  3. The rise of superstars—companies such as Amazon, Apple, and Google generate substantial revenues and their ever-rising stock prices enriched top shareholders and executives.

  4. The decline of organized labor—the share of union labors has dropped by half to just over 10% during the last four decades.

  5. Changing and breaking the rules—tax cuts disproportionately favor the most affluent Americans, just as one example.


Regardless of the views of contributors to economic inequality, the consequence is unhappy Americans. “People are increasingly likely to report that they believe the system is rigged against them,” said University of Maryland economist Melissa Kearney. “We’re going to see people in increasing numbers dropping out of our mainstream drive for economic success. It’s leading to large, loud political cries for completely upending our capitalist system.”


(1) https://www.pewresearch.org/social-trends/2020/01/09/what-americans-see-as-contributors-to-economic-inequality/

(2) https://www.cnbc.com/2019/06/05/5-reasons-income-inequality-has-become-a-major-political-issue.html


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