ECONOMICS
INCOME DISTRIBUTION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Negative effect to an unequal distribution of income and wealth
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Positive effect to an unequal distribution of income and wealth
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Either A or B
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None of the above
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Detailed explanation-1: -The feeling of disadvantage and unfairness leads the poor to seek compensation and satisfaction by all means, including committing crimes against both poor and rich. It is difficult to distinguish empirically between the economic and sociological explanations for the observed correlation between inequality and crime.
Detailed explanation-2: -Less equal societies have less stable economies. High levels of income inequality are linked to economic instability, financial crisis, debt and inflation.
Detailed explanation-3: -Some of key factors behind the increase in within-country income inequality noted in the literature include technological progress, globalization, commodity price cycles, and domestic economic policies such as redistributive fiscal policies, labor and product market policies.
Detailed explanation-4: -There is evidence that wide inequalities in wealth can contribute to unsustainable economic growth and perpetuate inequalities in education and employment.