Advantages And Disadvantages Of Rising Income Inequality

Income inequality in the last few decades has been increasing. The interesting thing is that the gap between the middle and top is increasing significantly, unlike the gap between the middle and the bottom, which is staying relatively stable.
Rising inequality has advantages and disadvantages to it. One of the significant advantages that it has is that it drives economic growth. Inequality fell during the 2007-2008 economic recession and then recovered when the U.S economy recovered. Another way that income inequality drives economic growth is because it serves as a factor of motivation for certain people. It encourages them to work harder or invent new products so that they can become members of the higher income society. If the gap between the income levels is small then most people won’t be as motivated to work hard or invent new products because the increase of the income isn’t very significant. One of the significant disadvantages that rising inequality has is that it stifles economic growth. A certain amount of inequality can have a positive impact on economic growth; however, that is only a short term thing. A society with a high level of income inequality leads to a high level of poverty. A high level of poverty leads an increase in crimes and poor public health which places a burden on the economy. Also, the support for pro-growth government policies would decline because of the increase of food prices and
It is going to be a struggle to maintain your financial status if you aren’t part of the rich society because things are going to start getting more expensive. That will cause the middle and lower income society to struggle even more to be able to make enough money to live. Rising inequality puts a lot of pressure on the middle and lower income society but benefits the rich society a lot. The rich will get richer and the poor will get