Back
0

The Piketty-Saez Hypothesis

Description: The Piketty-Saez Hypothesis Quiz
Number of Questions: 14
Created by:
Tags: economics economic inequality piketty-saez hypothesis
Start the Quiz
Attempted 0/14 Correct 0 Score 0
‹
›

What is the central argument of the Piketty-Saez Hypothesis?

  1. Wealth inequality is increasing over time.

  2. Wealth inequality is decreasing over time.

  3. Wealth inequality is constant over time.

  4. Wealth inequality is unrelated to income inequality.

Show answer
Correct Option: A
Explanation:

The Piketty-Saez Hypothesis states that wealth inequality is increasing over time due to the fact that the rate of return on capital is greater than the rate of economic growth.

What is the 'r > g' inequality?

  1. The rate of return on capital is greater than the rate of economic growth.

  2. The rate of return on capital is less than the rate of economic growth.

  3. The rate of return on capital is equal to the rate of economic growth.

  4. The rate of return on capital is unrelated to the rate of economic growth.

Show answer
Correct Option: A
Explanation:

The 'r > g' inequality is a key component of the Piketty-Saez Hypothesis. It states that the rate of return on capital is greater than the rate of economic growth, which leads to increasing wealth inequality over time.

What is the 'wealth-to-income ratio'?

  1. The ratio of total wealth to total income.

  2. The ratio of total wealth to total consumption.

  3. The ratio of total wealth to total savings.

  4. The ratio of total wealth to total investment.

Show answer
Correct Option: A
Explanation:

The 'wealth-to-income ratio' is a measure of wealth inequality. It is calculated by dividing total wealth by total income.

According to the Piketty-Saez Hypothesis, what is the long-run trend of the wealth-to-income ratio?

  1. It will increase over time.

  2. It will decrease over time.

  3. It will remain constant over time.

  4. It will fluctuate over time.

Show answer
Correct Option: A
Explanation:

The Piketty-Saez Hypothesis predicts that the wealth-to-income ratio will increase over time due to the 'r > g' inequality.

What are some of the policy implications of the Piketty-Saez Hypothesis?

  1. Progressive taxation.

  2. Wealth redistribution.

  3. Investment in education and human capital.

  4. All of the above.

Show answer
Correct Option: D
Explanation:

The Piketty-Saez Hypothesis suggests that a number of policy measures could be used to address wealth inequality, including progressive taxation, wealth redistribution, and investment in education and human capital.

Which country has the highest wealth-to-income ratio in the world?

  1. United States

  2. China

  3. Japan

  4. Germany

Show answer
Correct Option: A
Explanation:

The United States has the highest wealth-to-income ratio in the world, followed by China, Japan, and Germany.

What is the 'inheritance effect'?

  1. The tendency for wealth to be passed down from generation to generation.

  2. The tendency for wealth to be accumulated by individuals over their lifetime.

  3. The tendency for wealth to be distributed equally across society.

  4. The tendency for wealth to be concentrated in the hands of a few individuals.

Show answer
Correct Option: A
Explanation:

The 'inheritance effect' is the tendency for wealth to be passed down from generation to generation. This can contribute to wealth inequality, as individuals who inherit wealth are more likely to accumulate more wealth over their lifetime.

What is the 'self-reinforcing mechanism' of wealth inequality?

  1. The tendency for wealth to beget more wealth.

  2. The tendency for wealth to be lost over time.

  3. The tendency for wealth to be distributed equally across society.

  4. The tendency for wealth to be concentrated in the hands of a few individuals.

Show answer
Correct Option: A
Explanation:

The 'self-reinforcing mechanism' of wealth inequality is the tendency for wealth to beget more wealth. This can occur through a number of mechanisms, such as the inheritance effect, the ability of wealthy individuals to access better education and healthcare, and the ability of wealthy individuals to invest in assets that appreciate in value.

What is the 'Kuznets curve'?

  1. A graph that shows the relationship between economic growth and income inequality.

  2. A graph that shows the relationship between economic growth and wealth inequality.

  3. A graph that shows the relationship between economic growth and the wealth-to-income ratio.

  4. A graph that shows the relationship between economic growth and the Gini coefficient.

Show answer
Correct Option: A
Explanation:

The 'Kuznets curve' is a graph that shows the relationship between economic growth and income inequality. It typically shows that income inequality increases in the early stages of economic growth, but then decreases as economic growth continues.

What is the 'Great Gatsby curve'?

  1. A graph that shows the relationship between economic growth and income inequality.

  2. A graph that shows the relationship between economic growth and wealth inequality.

  3. A graph that shows the relationship between economic growth and the wealth-to-income ratio.

  4. A graph that shows the relationship between economic growth and the Gini coefficient.

Show answer
Correct Option: B
Explanation:

The 'Great Gatsby curve' is a graph that shows the relationship between economic growth and wealth inequality. It typically shows that wealth inequality increases as economic growth increases.

What is the 'Piketty-Saez inequality index'?

  1. A measure of wealth inequality that is based on the wealth-to-income ratio.

  2. A measure of wealth inequality that is based on the Gini coefficient.

  3. A measure of wealth inequality that is based on the share of wealth held by the top 1%.

  4. A measure of wealth inequality that is based on the share of wealth held by the bottom 50%.

Show answer
Correct Option: A
Explanation:

The 'Piketty-Saez inequality index' is a measure of wealth inequality that is based on the wealth-to-income ratio. It is calculated by dividing the total wealth of a country by the total income of the country.

What is the 'Gini coefficient'?

  1. A measure of income inequality.

  2. A measure of wealth inequality.

  3. A measure of the wealth-to-income ratio.

  4. A measure of the share of wealth held by the top 1%.

Show answer
Correct Option: A
Explanation:

The 'Gini coefficient' is a measure of income inequality. It is calculated by dividing the area between the Lorenz curve and the line of perfect equality by the area below the line of perfect equality.

What is the 'share of wealth held by the top 1%'?

  1. A measure of income inequality.

  2. A measure of wealth inequality.

  3. A measure of the wealth-to-income ratio.

  4. A measure of the Gini coefficient.

Show answer
Correct Option: B
Explanation:

The 'share of wealth held by the top 1%' is a measure of wealth inequality. It is calculated by dividing the total wealth held by the top 1% of the population by the total wealth of the country.

What is the 'share of wealth held by the bottom 50%'?

  1. A measure of income inequality.

  2. A measure of wealth inequality.

  3. A measure of the wealth-to-income ratio.

  4. A measure of the Gini coefficient.

Show answer
Correct Option: B
Explanation:

The 'share of wealth held by the bottom 50%' is a measure of wealth inequality. It is calculated by dividing the total wealth held by the bottom 50% of the population by the total wealth of the country.

- Hide questions
ADVERTISEMENT

Find more quizzes from top tags

general knowledge
3615 Quizzes
119858 Questions
 technology
307 Quizzes
36705 Questions
 sports
963 Quizzes
19148 Questions
 history
1187 Quizzes
13475 Questions
 physics
598 Quizzes
13441 Questions
 biology
1160 Quizzes
12174 Questions
 science & technology
551 Quizzes
11015 Questions
 chemistry
490 Quizzes
9892 Questions
 maths
518 Quizzes
9324 Questions
 softskills
0 Quizzes
7131 Questions