Alfred Wong and Christine Ribeiro
Income inequality has gained considerable prominence worldwide in recent years. The growing discontent among the lower-income segment of industrialized societies is limited largely to resentment because of economic wealth being perceived to be steadily concentrating among fewer people. Quantified economic inequality does not necessarily mean the extreme deprivation of people, especially in Europe and North America. There will be no revolutionary-scale social unrest among the middle class if their expectation of satisfactory wellbeing is continually met. The connection between income inequality and poverty is uncertain because of the variable definition of poverty. The classical characterization of poverty is largely deficient as the actual economic hardships encountered by the lowest-income segment of society are never fully described in the socio-geographic context. What is deprivation in Europe and North America may be considered to be “luxurious” in economically poorer countries.
Vlastimir Leković
The research, focusing on the specific key aspects of economic inequality as well as economic equality, by analyzing numerous theoretical, methodological and empirical views concerning the mentioned socioeconomic phenomena, aims to identify the following related and relevant aspects that affect the efficiency of the functioning of a modern economy: a) economic inequality that has a stimulating effect on the creative, productive and innovative use of all production factors positively affects the functioning of the economy and is socially justifiable; b) a high level of economic inequality, which shows a tendency to further increase, has a negative effect on the economic system indicators as well as the stability of the society and the political environment, therefore resulting in a weaker economic performance and a lower economic growth rate; c) economic equality (certainly not egalitarianism), by contributing to greater social and political stability, which in turn reflects positively on economic stability and efficiency, is the basis for a greater success of the modern economy and dynamic economic growth rates. The main result of this study is assessing the basic factors of high and rising economic inequality and its implications for the functioning of modern economies, and accordingly, pointing to the need to implement economic policies that would lower economic inequality and mitigate its adverse consequences for the economy and the society.