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Using the data and your economic knowledge, evaluate the view that the benefits resulting from a more equal distribution of income exceed the costs.

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Introduction

´╗┐Using the data and your economic knowledge, evaluate the view that the benefits resulting from a more equal distribution of income exceed the costs. The distribution of income is defined as the distribution of wages earned across a company, industry or country. I will be focusing on the distribution of wages earned across a country. There are both advantages and disadvantages of the equal distribution of income. If it was equalised and everyone earned the same amount, people would have less incentives to do more challenging but vital jobs (e.g. ...read more.

Middle

This would come from both people in the higher quintiles of wage rates shown in extract A. These are both major disadvantages showing that it may not be practical to implement equal distribution as they don?t outweigh the costs which would be public outcry, striking and many others. The advantages of implementing are that society would be more equal, making debts, mortgages etc easier to manage for banks as everyone has the same income. ...read more.

Conclusion

This shows that it is better for the lower quintiles also shown in extract A as they would benefit from the equalisation of wage rates, this also means that the higher quintiles would lose their higher wage rates which would cause issues within society that would be part of the costs of implementing the scheme. In conclusion I feel that, although the base idea is good, especially for those of lower incomes and wage rates, the costs ? both social and economical (e.g. legally making everyone equal and striking) would be extremely high which I feel would be too high to pay. ...read more.

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