Global Economic Issues
Economics 300
Homework Assignment--Inequality in America
Due date: The
assignment must be turned-in at the start of class, points off will be taken if
handed in after class begins. No assignments will be accepted after.
The assignment should be typed and graphs should be attached as
requested.
We are way beyond the United States, but exploring our distribution and our
poverty places the rest of the world in better context. In the GDP data
assignment you studied the behavior of GDP and GDP per person over time. In this
section, you will study how this income is distributed in the US and we will
compare US income inequality with inequality in other nations
1. Visit https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html and
scroll down to H-3 All Races, Mean Household income Received by Each Fifth and
top 5 Percent. Scroll
down to 2015 dollars, then copy and paste the data under this section to another
sheet. Once there, on the excel tab Home, use the Sort and Filter icon to sort
the data such that the 1967 is at the top. Then graph the data with time on the
horizontal axis.
a. Define
with does a quintile mean? What
does it mean to be in the lowest quintile and in the top fourth quintile?
b. What
do the numbers of each quintile mean? For example, for 2010, the second quintile
number is 30,047,
what does that mean?
c. Describe
what the graph shows. What is happening to each quintile and the top 5%? Be
careful, I am not asking you to provide explanations nor to judge whether this
is good or bad, all I am asking is for you to describe what the data say.
a. Define
the Gini coefficient
b. What
would a Gini coefficient of 0 indicate? What would a Gini coefficient of 1
indicate?
3. Visit https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-inequality.html scroll down to F-4, Gini Ratios for Families and click there then copy and paste
the data under this section to another sheet. Once there, on the excel tab Home,
use the Sort and Filter icon to sort the data such that the 1947 is at the top.
a. Describe
what has happened to the Gini coefficient since 1947.
b. What
does this mean about income inequality in the US since 1947
4. Find
the article “American Inequality in Six Charts” by John Cassidy published in the
magazine The New Yorker on
November 18, 2013, http://www.newyorker.com/news/john-cassidy/american-inequality-in-six-charts.
Find the chart titled Income Inequality and Redistribution.
a. According
to this graph, which country has the most inequality before taxes and transfers?
b. According
to this graph, which country has the most inequality after taxes and transfers?
c. Among
the countries in this graph, which country uses the government least to make
income distribution less unequal?
5. Find
the article “American Inequality in Six Charts” by John Cassidy published in the
magazine The New Yorker on
November 18, 2013, http://www.newyorker.com/news/john-cassidy/american-inequality-in-six-charts.
Find the chart titled The Geography of Intergenerational Mobility in the US.
Income Inequality and Redistribution.
a. Explain
what the <5.4 number mean?
b. Explain
what the 9.6-10.4 range mean?
c. What does this say in general about income mobility in the US?