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Economic History of Economic Inequality

Description: This quiz covers the economic history of economic inequality, focusing on the evolution of income and wealth distribution over time.
Number of Questions: 15
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Tags: economic history economic inequality income distribution wealth distribution
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Which economic theory argues that income inequality is a natural outcome of differences in individual abilities and efforts?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Marxian Economic Theory

  4. Institutional Economic Theory


Correct Option: A
Explanation:

Classical economic theory, associated with economists like Adam Smith and David Ricardo, posits that income inequality arises from differences in individual productivity and contributions to the economy.

The concept of the Kuznets curve suggests that income inequality:

  1. Initially increases and then decreases as a country develops

  2. Initially decreases and then increases as a country develops

  3. Remains constant as a country develops

  4. Fluctuates randomly as a country develops


Correct Option: A
Explanation:

The Kuznets curve hypothesizes that income inequality tends to rise in the early stages of economic development and then decline as countries reach higher levels of development.

Which historical period is often associated with the emergence of modern economic inequality?

  1. The Industrial Revolution

  2. The Great Depression

  3. The Gilded Age

  4. The Roaring Twenties


Correct Option: A
Explanation:

The Industrial Revolution, which began in the late 18th century, brought about significant technological and economic changes that contributed to the rise of economic inequality.

The concept of relative deprivation in economic inequality refers to:

  1. The perception of inequality based on subjective comparisons with others

  2. The absolute difference in income or wealth between individuals or groups

  3. The share of income or wealth held by the richest individuals or groups

  4. The level of poverty or destitution in a society


Correct Option: A
Explanation:

Relative deprivation in economic inequality focuses on individuals' subjective perceptions of inequality based on comparisons with others, rather than objective measures of income or wealth.

Which economic theory emphasizes the role of power and class relations in shaping economic inequality?

  1. Neoclassical Economic Theory

  2. Marxian Economic Theory

  3. Keynesian Economic Theory

  4. Institutional Economic Theory


Correct Option: B
Explanation:

Marxian economic theory, developed by Karl Marx, emphasizes the role of class relations and the exploitation of labor in creating and perpetuating economic inequality.

The Gini coefficient is a measure of:

  1. Income inequality

  2. Wealth inequality

  3. Poverty

  4. Unemployment


Correct Option: A
Explanation:

The Gini coefficient is a widely used measure of income inequality, ranging from 0 (perfect equality) to 1 (perfect inequality).

The concept of the '1%' refers to:

  1. The top 1% of income earners in a society

  2. The top 1% of wealth holders in a society

  3. The bottom 1% of income earners in a society

  4. The bottom 1% of wealth holders in a society


Correct Option: A
Explanation:

The '1%' refers to the top 1% of income earners in a society, often used to highlight the concentration of wealth and income among a small group of individuals.

Which historical event is often associated with a significant increase in economic inequality in the United States?

  1. The Civil War

  2. The Great Depression

  3. World War II

  4. The Reagan Era


Correct Option: D
Explanation:

The Reagan Era, referring to the presidency of Ronald Reagan in the 1980s, is often associated with policies that contributed to a widening of the income gap in the United States.

The concept of 'trickle-down economics' refers to the idea that:

  1. Economic benefits from the wealthy will eventually reach the poor

  2. Economic benefits from the poor will eventually reach the wealthy

  3. Economic benefits are equally distributed across all income groups

  4. Economic benefits are concentrated among the middle class


Correct Option: A
Explanation:

Trickle-down economics is a theory that suggests that economic benefits from tax cuts and other policies favoring the wealthy will eventually trickle down to the poor and benefit the entire economy.

The concept of 'occupational segregation' in economic inequality refers to:

  1. The concentration of certain occupations among specific demographic groups

  2. The separation of different occupations based on skill level

  3. The division of labor into different industries

  4. The geographic distribution of different occupations


Correct Option: A
Explanation:

Occupational segregation refers to the concentration of certain occupations among specific demographic groups, such as gender, race, or ethnicity, leading to disparities in income and opportunities.

Which economic theory emphasizes the role of institutions and social structures in shaping economic inequality?

  1. Neoclassical Economic Theory

  2. Marxian Economic Theory

  3. Keynesian Economic Theory

  4. Institutional Economic Theory


Correct Option: D
Explanation:

Institutional economic theory focuses on the role of institutions, such as property rights, legal systems, and social norms, in shaping economic outcomes and inequality.

The concept of 'intergenerational mobility' in economic inequality refers to:

  1. The ability of individuals to move up or down the economic ladder across generations

  2. The movement of individuals between different occupations or industries

  3. The geographic mobility of individuals across regions or countries

  4. The ability of individuals to accumulate wealth over time


Correct Option: A
Explanation:

Intergenerational mobility refers to the extent to which individuals' economic status is correlated with the economic status of their parents or ancestors.

The concept of 'human capital' in economic inequality refers to:

  1. The skills, knowledge, and abilities of individuals that contribute to their earning potential

  2. The physical capital, such as machinery and equipment, used in production

  3. The natural resources, such as land and minerals, available in a country

  4. The financial capital, such as stocks and bonds, held by individuals or institutions


Correct Option: A
Explanation:

Human capital refers to the skills, knowledge, and abilities of individuals that contribute to their productivity and earning potential, such as education, training, and experience.

Which historical period is often associated with a significant decrease in economic inequality in the United States?

  1. The Gilded Age

  2. The Progressive Era

  3. The New Deal Era

  4. The Great Society Era


Correct Option: C
Explanation:

The New Deal Era, referring to the presidency of Franklin D. Roosevelt in the 1930s, is often associated with policies that helped reduce economic inequality during the Great Depression.

The concept of 'economic mobility' in economic inequality refers to:

  1. The ability of individuals to move up or down the economic ladder over time

  2. The movement of individuals between different occupations or industries

  3. The geographic mobility of individuals across regions or countries

  4. The ability of individuals to accumulate wealth over time


Correct Option: A
Explanation:

Economic mobility refers to the extent to which individuals' economic status can change over time, either upward or downward.

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