Great Divergence (inequality)
 | It has been suggested that this article be merged with Causes of income inequality in the United States. (Discuss) Proposed since November 2024. |
The Great Divergence is a term given to a period, starting in the late 1970s, during which income differences drastically increased in the United States and, to a lesser extent, in other countries. The term originated with the Nobel laureate, Princeton economist and The New York Times columnist Paul Krugman,[1] and is a reference to the "Great Compression", an earlier era in the 1930s and the 1940s when incomes became more equal in the US and elsewhere.[2]
The Great Divergence contrasts with the "Great Prosperity" or Golden Age of Capitalism, where from the late 1940s to mid 1970s, at least for workers in the advanced economies, economic growth had delivered benefits broadly shared across the earnings spectrums, with inequality falling as the poorest sections of society increased their incomes at a faster rate than the richest.[3]
Scholars and others differ as the causes and significance of the divergence,[4][5] which helped ignite the Occupy movement in 2011. While education and increased demand for skilled labour is often cited as a cause of increased inequality,[6] especially among conservatives, many social scientists[7] point to conservative politics, neoliberal economic and social policies[8][9] and public policy as an important cause of inequality; others believe its causes are not well understood.[10]
See also
[edit]
- Economic history of the United States
- Economic inequality
- Economic stagnation
- The End of Work
- Socioeconomic mobility in the United States
- Wealth inequality in the United States
References
[edit]- ^ Krugman, Paul, The Conscience of a Liberal, W W Norton & Company, 2007, pp. 124–128
- ^ The Great Divergence. By Timothy Noah
- ^ Robert B. Reich (3 September 2011). "The Limping Middle Class". The New York Times. Retrieved 6 September 2011.
During periods when the very rich took home a larger proportion—as between 1918 and 1933, and in the Great Regression from 1981 to the present day—growth slowed, median wages stagnated and we suffered giant downturns. ...
- ^ Krugman, Paul. "The Rich, the Right, and the Facts: Deconstructing the Income Distribution Debate" prospect.org, 19 December 2001
- ^ Sowell, Thomas. "Perennial Economic Fallacies," Jewish World Review 7 February 2000, URL accessed 3 November 2011.
- ^ "CIA. (June 14, 2007). United States: Economy. World Factbook". Retrieved 20 June 2007.
- ^ such as economists Paul Krugman and Timothy Smeeding and political scientists Larry Bartels and Nathan Kelly
- ^ Stephen Haymes, Maria Vidal de Haymes and Reuben Miller (eds), The Routledge Handbook of Poverty in the United States, (London: Routledge, 2015), ISBN 0415673445, p. 7.
- ^ David M. Kotz, The Rise and Fall of Neoliberal Capitalism, (Cambridge, Massachusetts: Harvard University Press, 2015), ISBN 0674725654. p. 43
- ^ Congressional Budget Office: Trends in the Distribution of Household Income Between 1979 and 2007. October 2011.