2 Running head: ANALYZING THE WEALTH Analyzing the Wealth Gap among Economic Classes Bruce Xu University of Miami Introduction The wealth gap, the increasing concentration of wealth in fewer hands, has been called the “defining challenge of our time”(Buttrick and Oishi, 2017). In Hero and Levy’s article(2016), it is also called “the great divergence of America’s rich from its middle class and poor.” In fact, the “mordern” wealth inequality can be traced to the evolution of human survival from foraging to farming more than 10,000 years ago (Patel and Bagchi, 2018). For the United States, its origin was in the early of the 20th century. According to David and Jonathan(2016), the wealth inequality began a long but modest decline since 1929. However, this trajectory reversed throughout the industrialized world during the last 40 years (Buttrick and Oishi, 2017). Wealth inequality occurs in countries among different kinds of people. This paper discusses the wealth inequality between different classes of people in America. Especially, it analyzes wealth gap between the citizens from middle class and lower class. The middle class of the U.S. are those earning between two-thirds and double the median household income. This means that the category of middle – income is made up of people making somewhere between $40,500 and $122,000, which represents the majority of the American. Those who do not participate in the labor force and rely on public assistance as their main source of income are commonly identified as members of the lower class.This paper provides a literature review on wealth inequality. What’s more, it will examine three themes based on the topic, which are the elements and factors lead to the wealth inequality, the negative impact of the wealth gap in the U.S. on the resident’s life and the possible solutions of this phenomenon. Literature Review Elements and factors lead to wealth inequality Nowadays, wealth inequality has become a national even world –wide problem. Probably most people’s comprehension on the causes of wealth inequality is the wage inequality which is unequal distribution of income. In fact, there are still many other factors lead to wealth inequality. Dirlam (2016) concludes that the reduction of employment in manufacturing had influential effects on wealth inequality. Also, Dirlam (2016) states that the increased differences between management’s and labor’s political resources combine to produce a growth in income inequality. Since 1981, the neoliberal political departure has begun. Those intensely neoliberal national administrations were sympathetic to employers and unfavorable to labor take office. Thus, the reduction in union strength reduced a core labor political resource, which lead to wealth inequality. Moreover, McKernan (2013) thought the gifts and inheritances play a further role in perpetuating the wealth gap. For higher wealth family, they are able to sent their children to high-quality education.

1. 2
Running head: ANALYZING THE WEALTH
Analyzing the Wealth Gap among Economic Classes
Bruce Xu
University of Miami
Introduction
The wealth gap, the increasing concentration of wealth in fewer
hands, has been called the “defining challenge of our
time”(Buttrick and Oishi, 2017). In Hero and Levy’s
article(2016), it is also called “the great divergence of
America’s rich from its middle class and poor.” In fact, the
“mordern” wealth inequality can be traced to the evolution of
human survival from foraging to farming more than 10,000
years ago (Patel and Bagchi, 2018). For the United States, its
origin was in the early of the 20th century. According to David
and Jonathan(2016), the wealth inequality began a long but
modest decline since 1929. However, this trajectory reversed
throughout the industrialized world during the last 40 years
(Buttrick and Oishi, 2017).
Wealth inequality occurs in countries among different kinds of
people. This paper discusses the wealth inequality between
different classes of people in America. Especially, it analyzes
wealth gap between the citizens from middle class and lower
class. The middle class of the U.S. are those earning between
two-thirds and double the median household income. This

2. means that the category of middle – income is made up of
people making somewhere between $40,500 and $122,000,
which represents the majority of the American. Those who do
not participate in the labor force and rely on public assistance
as their main source of income are commonly identified as
members of the lower class.This paper provides a literature
review on wealth inequality. What’s more, it will examine three
themes based on the topic, which are the elements and factors
lead to the wealth inequality, the negative impact of the wealth
gap in the U.S. on the resident’s life and the possible solutions
of this phenomenon.
Literature Review
Elements and factors lead to wealth inequality
Nowadays, wealth inequality has become a national even world
–wide problem. Probably most people’s comprehension on the
causes of wealth inequality is the wage inequality which is
unequal distribution of income. In fact, there are still many
other factors lead to wealth inequality. Dirlam (2016) concludes
that the reduction of employment in manufacturing had
influential effects on wealth inequality. Also, Dirlam (2016)
states that the increased differences between management’s and
labor’s political resources combine to produce a growth in
income inequality. Since 1981, the neoliberal political departure
has begun. Those intensely neoliberal national administrations
were sympathetic to employers and unfavorable to labor take
office. Thus, the reduction in union strength reduced a core
labor political resource, which lead to wealth inequality.
Moreover, McKernan (2013) thought the gifts and inheritances
play a further role in perpetuating the wealth gap. For higher
wealth family, they are able to sent their children to high-
quality educational systems like college or private school. For
the majority of families, children own more assets that can be
inherited to enhance even the start of a small business than
some minorities. Similarly, Mr. Buttrick (2016) said that the
generational passing of wealth has led to the rich children
inheriting the rich class and the middleclass. Meanwhile, the

3. poor children inherit less poverty and hence the gap in wealth
distribution increase.
Another factor causes wealth inequality is the great
difficulty of borrowing money or any kind of asset. Patel and
Bagchi (2018) point out that when the interest rates are high,
people in lower social class avoid borrowing. Consequently,
they have fewer opportunities to start their own business
without such fundamental assets. According to McKernan
(2013), discrimination by the upper and middle class against the
lower social class discourages the poor from borrowing as well.
The negative impact in the U.S. on the resident’s life
The wealth gap are not on the economies but also on the
individuals. The expansion in the salary disparity has
significantly influenced the minority bunches in the nation who
have stayed in the lower social classes (Jacobs, D., &Dirlam, J.
C. 2016). The 90% of the populace have been left with a little
level of wealth expanding destitution.
The entrance of basic administrations, for example, wellbeing
has been influenced in many occasions (Hero, R. E., & Levy, M.
E. 2016). Expanded work levels in light of the fact that most of
the wealth is collected by few individuals. Expanding trouble on
the administration as it is required to offer fundamental
administrations, for example, instruction and wellbeing.
It causes an expansion in more awful wellbeing for the populace
the poor as well as the rich (McKernan, S. M. 2013). More
prominent gap in wealth dissemination causes lower prosperity,
for example, psychological instabilities, sorrow and inclusion in
wrongdoing, for example, strike and murder.
Different issues are corpulence, imprisonment and social
treacheries. Large amounts of wealth disparity influence US
since it decreases the dimensions of intergenerational versatility
(Saez, E., &Zucman, G. 2016). The general population in the
lower classes have encountered stagnation in profit and personal
satisfaction.
The expanding gap between poor people and the rich families
makes it exceptionally troublesome for the poor kids to climb

4. the monetary stepping stool even later on (Jones, C. I. 2015).
The well-off people acquire from the wealth gap contrasted with
poor people and consequently kept on sustaining exercises that
are expanding the gap (Buttrick, N. R., &Oishi, S. 2017).
Expanded destitution levels among the working class and the
poor on account of the expanded reliance and decreased sparing.
Diminished pioneering developments and advancements in the
white collar class and poor populaces.
The solutions for the wealth inequality
There are many cause and effects of this income inequality but
on the other hand the solution to remove this inequality is also
present. To remove this inequality the democracy and the role
of all political parties is extremely important. Furthermore, all
the policy makers have to design such policy that remove these
inequality barriers (Jacobs, D., &Dirlam, J. C. 2016).
Decreasing imbalance in pay circulation is fundamental for
social equity reasons in the general public.
It is additionally imperative for social attachment and financial
development. Reinforcing the enterprising biological system
assumes a noteworthy job in decreasing disparity (McKernan, S.
M. 2013). This includes offering instructing projects to poor
people and working class just as arrangement of capital for new
businesses and development of organizations.
Government responsibility through various offices cooperating
to close the wealth gap and improve access to working capital
by the private ventures. Order strategies that improve sparing
society of the white collar class and poor people. They
incorporate decrease in home loans interests' rates (Saez, E.,
&Zucman, G. 2016). Moderating lines of wealth should be
possible by establishment of arrangements, for example, a
wealth charge. Backing by wealth is a strategy that is trying in
lessening the wealth gap yet it might create positive outcomes
over the long haul (Scully, M., Rothenberg, S., Beaton, E. E., &
Tang, Z. 2018) This is the place the well-off choose to help the
activities that help improvement of wealth fairness Utilizing
"benefit work" where the rich utilize their insight into wealth

5. aggregation together with poor people (Jones, C. I. 2015).
Improved instruction framework to upgrade execution of poor
people and the white collar class in work environments and
organizations.
Reference
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