Income inequality is the most basic form of economic inequality. Statistically, income inequality has increased gradually in Canada and most other developed countries since the 1970's.
StatsCan: Between 1980 and 2005, â€œEarnings ... rose for those at the top of the earnings distribution, stagnated for those in the middle and declined for those at the bottom.â€
- statistical: there are more single parent families, who are frequently low income.
- statistical: more time spent in education (with lower income in that period)
- economic: globalization => increases global wage competition for low skill jobs.
- economic: globalization => larger corporations, bigger hierarchies with more unequal payscales.
- economic: technology change produces winners and losers, and a premium on education.
- demographic: we are just over the peak of a global baby bom the last 50 years, which depresses wages globally.
Increased Inequality is a function of economic growth.Inequality is the difference between the highest incomes and the lowest. As the economy grows, the highest incomes only get higher while the bottom stays at zero. Since there will always be some people with no income, inequality is bound to grow as a mathematical fact.
corporate governance improves, as it is likely to do if governments don't go more rotten than they already are, market forces will help reduce the income gap. In the long run we need to defeat elitism in the labor market. People aren't earning 10x the salary because they are 10x as talented or 10x as productive. The way a corporation's income is distributed internally is mostly a question of politics bounded by economics. Internal transparency would go a long way to helping this. Who gets what should not be a secret.