The Economic System Of Economic Inequality Essay examples
By the early 90s, capitalism has established itself as the ideal economic system in the world after the collapse of command economy in Communist countries and abandonment of import-substitution strategies in Latin America and other developing countries1. However, over the past two decades, one of the main challenges of capitalism has emerged in the form of widening income inequality across most developed and emerging economies2. The negative effect of income disparity is succinctly bipolar for the market capitalism of US: The rich continue to generate disproportionate growing returns and consume only a small fraction of their income3 while the “remaining 99.9%”4 suffer economic discrimination and insecurity5.
In this exploratory research, I shall compare the different national economies using the criteria of economic inequality. Next, I will attempt to establish the correlation between inequality and the role of the government through redistributive fiscal policies. These statistical findings will eventually be tied to some of the key concepts from the class readings, particularly on the comparison of national systems of political economy.
For data sampling, I have selected four developed countries and two emerging countries i.e. US, Japan, Germany, Sweden, China and India. The time scale chosen for the analysis is 1990-2006, to coincide with the rise of globalization and due to data availability. The metric I utilized to track income inequality is the…