why is there a gross unequal distribution of wealth? why is there widening gaps between rich and poor?

Question

please answer.
its for research. :]
thanks.

Answer 1

There's a bunch of theories mostly based based on the "O-ring effect" which explain how the generalization of competition, worlwide and at all levels of societies leads to increasing inequalities. It might be pop-economics, but you might wanna have a look at it.

In a nutshell, it says than over-competitive environment leads to a need for structures to have the most effective elements at all levels of the process (the analogy is with the "challenger shuttle" accident : the whole structure was almost perfect, only a tiny piece of rubber was deffective and it made the whole thing explode), while leads to widening gap between the "best" (I use brackets because "best" here is only meant as "most efficient in the current economic system"...) elements and the others.

Answer 2

There isn't a widening gap in America. That is a myth. It is just the opposite.

If you go back even 100 years and you pick out what was called poor and what is rich and you would find that the poor person in the winter literally was staving to death with clothes that were falling off of them and no place to live, and of course the rich could had warm clothing, food, a mansion, ... But interesting enough for all their wealth they still didn't have the medical care of all but the poorest person living today.
Today our "poor" people drive cars. Our poor people can walk into a hospital and get care (ER). Our poor people are overweight. Our poor people watch TV. Our poor people have access to computers (if not at home, at the library).

P.S. The middle class pretty much didn't exist 100 years ago that is a recent creation and certainly the fact that it is so large is new.

P.S.S. There is a gross unequal distribution of wealth because society rewards what it wants. It is like asking why the government gives a tax credit on the interest paid on a house loan. We (the government is the people) do it because buying a house is good for the economy and that is good for the country.

Answer 3

I am assuming you are talking about America. Their is a widening gap because the rest of the world is catching. People in America think a High School Diploma can still hack it. The guy answering the phone in India probably has a Masters degree and is willing to work for 1/10th the price. Who would you hire? Men don't go to school. Trade jobs are down because a Mexican can walk across the border who has the same job skills and is willing to work for less and harder to. Our society is not keeping up with the Education and Job training that is going on in the rest of the world. What are the high paying jobs? The ones that require 4+ years of education. The education is our widening gap which correlates to income.

Answer 4

There are an unlimited number of answers but one big answer is that there gross political corruption and the government makes it this way.

The government is deeply tied to businesses and they have allowed businesses to create a labor black market which harms the poorer workers but importing cheap labor illegally. This means that there are 13 million illegal poor workers competing with our citizens for the same jobs. When someone is willing to work cheaper and longer for less wages it leads to depressed wages. Americans will do any job... at the right price. The right price will never be reached because of the constant flow of cheap labor. The government is complacent in allowing this to happen.

At the same time the government has allowed 13 million illegals to compete with the poor for jobs they have limited the H1-B visas to 65,000 per year. These are the visas which are given to professional educated workers (Doctors, Engineers, Software Developers etc). The rich keep competition low and the poor get the shaft. This leads to a greater and greater gap.

Also check into barriers to entry for jobs held by the wealthy and jobs held by the poor you'll find quite a different picture.

There are many different reasons but those are a few to start.

Answer 5

There is a lot of data that may interest you at
http://visualizingeconomics.com/
There is no agreement among economist as to why. The candidates are in 3 general categories, a decrease in the capital labor ratio because of a rapidly growing work force, new technology changed the economy, and government policies.

Increasing trade
Increasing immigration
Increase in the work force due to the coming of age of the baby boomers and an increase in the number of working women

New technology lowered the value of low skill workers and increased the value of a college education
New technology creates a winner take all society, ie the best musicians are paid most of the money people spend on music because of high quality recordings.

Government policies on Unions and taxes and deficits
Monetary policy by the fed that kept unemployment "high during most of the period.

Answer 6

Well, in capitalism, the amount of money you have is pretty much proportional to the amount of money you can make. So if you have more money to begin with, you make more money.