TABLE OF FIGURES Table 1. Variables used in the model 14 Table 2 Statistical description of variables 16 Table 3 Correlation description of data 18 Table 4 Initial regression of the model 19 Table 5 Correlation between variables 21 Table 6 Regression after fixing Multicollinearity 22 Table 7 Test for Normality of u 24 Table 8 95% confidence interval 26 ABSTRACT This research study examines income inequality in the United States from 2000 to 2020. Income inequality has been a persistent issue in the United States, with significant implications for economic, social, and political dynamics. The objective of this study is to analyze data of income inequality over the selected period and explore the factors that contribute to its dynamics. The research utilizes a comprehensive dataset obtained from reliable sources, such as government agencies and academic research, to analyze key indicators of income inequality, including measures of income disparities and wealth gaps. Econometric models and statistical analyses are employed to examine the relationships between income inequality and various factors, such as GDP per capita, population growth, unemployment rate, poverty headcount ratio, and age dependency. The findings of this study reveal the extent and evolution of income inequality in the United States over the analyzed period. The research highlights the increasing concentration of income among the top earners, as well as the challenges faced by lowerincome households in attaining economic prosperity. Moreover, the study investigates the potential impact of income inequality on economic growth, social mobility, and overall societal wellbeing.
https://tailieuluatkinhte.com/ FOREIGN TRADE UNIVERSITY FACULTY OF INTERNATIONAL ECONOMIC INTERNATIONAL ECONOMIC HIGH-QUALITY PROGRAM =============== ECONOMETRICS REPORT FACTORS ATTRIBUTING TO INCOME INEQUALITY IN THE UNITED STATES 2000 – 2020 CLASS: KTEE318 INSTRUCTOR: DR NGUYEN BINH DUONG GROUP: Hanoi, /06/23 https://tailieuluatkinhte.com/ TABLE OF FIGURES Table Variables used in the model .14 Table Statistical description of variables 16 Table Correlation description of data 18 Table Initial regression of the model 19 Table Correlation between variables 21 Table Regression after fixing Multi-collinearity 22 Table Test for Normality of u .24 Table 95% confidence interval .26 https://tailieuluatkinhte.com/ ABSTRACT This research study examines income inequality in the United States from 2000 to 2020 Income inequality has been a persistent issue in the United States, with significant implications for economic, social, and political dynamics The objective of this study is to analyze data of income inequality over the selected period and explore the factors that contribute to its dynamics The research utilizes a comprehensive dataset obtained from reliable sources, such as government agencies and academic research, to analyze key indicators of income inequality, including measures of income disparities and wealth gaps Econometric models and statistical analyses are employed to examine the relationships between income inequality and various factors, such as GDP per capita, population growth, unemployment rate, poverty headcount ratio, and age dependency The findings of this study reveal the extent and evolution of income inequality in the United States over the analyzed period The research highlights the increasing concentration of income among the top earners, as well as the challenges faced by lower-income households in attaining economic prosperity Moreover, the study investigates the potential impact of income inequality on economic growth, social mobility, and overall societal well-being https://tailieuluatkinhte.com/ I Introduction: Research objective: The objective of this research is to comprehensively examine the trends and determinants of income inequality in the United States from 2000 to 2020 The study aims to shed light on the complex dynamics of income distribution over this period and provide a deeper understanding of the factors contributing to the observed patterns Specifically, the research aims to achieve the following objectives: 1.1 Analyze the long-term trends in income inequality in the United States over the specified time period and identify any significant changes or patterns: This objective entails conducting a detailed analysis of income inequality measures, such as the Gini coefficient The research will investigate whether income inequality has been increasing, decreasing, or exhibiting fluctuations during the study period 1.2 Assess the impact of economic factors, such as GDP growth, unemployment rates, and poverty headcount ratio, on income inequality during the study period: This objective involves examining the relationship between macroeconomic indicators and income inequality The research will investigate whether periods of economic growth or recession are associated with changes in income inequality It will also analyze how changes in labor market conditions, such as shifts in unemployment rates or wage levels, influence income disparities among different income groups By doing so, the research seeks to gain a deeper understanding of the extent of poverty and inform policies and interventions aimed at reducing poverty and improving the well-being of individuals and communities 1.3 Provide policy recommendations and interventions aimed at mitigating income inequality in the United States, considering the findings and insights derived from the analysis: This final objective involves translating the research findings into actionable policy recommendations The research will identify evidence-based strategies and interventions that can effectively address income inequality in the United States It will consider the multi-faceted nature of income disparities and propose comprehensive policy approaches, encompassing areas such as taxation, education, labor market regulations, social welfare programs, and wealth redistribution https://tailieuluatkinhte.com/ By addressing these research objectives, this study aims to make significant contributions to the existing literature on income inequality in the United States It seeks to enhance our understanding of the causes and consequences of income disparities, provide valuable insights for policymakers and stakeholders, and contribute to the ongoing discourse on creating a more equitable society Research Questions: Just over a decade since the conclusion of the Great Recession in 2009, the United States is experiencing positive economic developments across various aspects The job market has been consistently generating employment opportunities, resulting in over 110 consecutive months of job growth, a milestone unprecedented since the post-World War II era As of November 2019, the unemployment rate stood at 3.5%, a level last witnessed in the 1960s These positive employment trends have also contributed to an improvement in household incomes, which have shown signs of recovery in recent years However, not all economic indicators paint an optimistic picture Household incomes have experienced only modest growth in the 21st century, and household wealth has yet to reach pre-recession levels Economic inequality, whether measured through income disparities or wealth gaps between affluent and lowerincome households, continues to widen Despite the overall positive economic climate, these persistent disparities raise concerns about the unequal distribution of economic resources and opportunities within society 2.1 What factors contribute mainly to income inequality in the United States? 2.2 What measures are proposed to reduce income inequality in the US? By addressing these research questions, the study aims to provide insights into the complex relationship between income inequality and various socioeconomic factors, including GDP per capita, population growth, unemployment, poverty rates, and age dependency This research will contribute to a better understanding of the drivers of income inequality in the United States and inform policies and strategies for promoting more equitable income distribution Scope of study: 3.1 Data Collection: The study will utilize reliable and comprehensive statistical data from various sources, including but not limited to: The Investopedia team, National Library of Medicine of the US, https://tailieuluatkinhte.com/ 3.2 Timeframe: The study will focus on the period from 2000 to 2020 to capture the long-term trends and dynamics of income inequality in the United States This time frame allows for a substantial analysis of income disparities over nearly two decades 3.3 Measurement of Income Inequality: The study will employ various commonly used indicators to measure income inequality, including: Gini coefficient: A widely used measure that quantifies income inequality on a scale of to 1, where represents perfect equality and represents maximum inequality. 3.4 Statistical Analysis: The study will utilize rigorous quantitative methods, such as descriptive statistics, regression analysis, and trend analysis, to analyze and interpret the data It will also assess the significance of relationships and identify any notable patterns or shifts in income inequality over the study period 3.5 Limitations: The study acknowledges potential limitations in data accuracy, sampling biases, and other constraints inherent in secondary data sources It will provide a comprehensive analysis within the available data's scope and time frame Methodology overview: The Ordinary Least Squares (OLS) method is mainly applied in this research Structure overview: 5.1 Introduction: Provides background information on income inequality in the US, states the research problem or objective, and explains the significance and relevance of studying this topic 5.2 Literature Review: Summarizes existing research and studies related to income inequality in the US, identifies gaps or limitations in previous literature, and establishes the theoretical framework or conceptual basis for the current research 5.3 Methodology: Describes the research design, data collection methods (secondary data analysis), sample selection, and data analysis techniques specific to studying income inequality in the US 5.4 Data Analysis and Findings: Presents the results of the data analysis, including statistical measures and visual representations, to examine the levels and trends of https://tailieuluatkinhte.com/ income inequality in the US over the selected period (2002 to 2020): statistical description and Correlation between variables, estimation and hypothesis testing 5.5 Conclusion and recommendation: Summarizes the main findings and conclusions of the research on income inequality in the US, emphasizes the significance of the study, and suggests possible avenues for future research 5.6 Reference: Lists all the sources cited in the research paper following a specific citation style (e.g., APA, MLA) II Literature review: Theoretical framework: Definition of each variable: - GDP per capita: Gross domestic product (GDP) per capita is an economic metric that breaks down a country's economic output per person Economists use GDP per capita to determine how prosperous countries are based on their economic growth GDP per capita is calculated by dividing the GDP of a nation by its population Countries with the higher GDP per capita tend to be those that are industrial, developed countries - Population growth: population growth, in population ecology, a change in the number of members of a certain plant animal species in a particular location during a particular time period Factors affecting population growth include fertility, mortality, and in animals, migration—i.e., immigration to or emigration from a particular location The average change in a population over time is referred to as the population growth rate A positive growth rate indicates a population increase, and a negative growth rate indicates a population decrease The upper limit of a population in a given environment, referred to as the environment’s carrying capacity, is determined by the amount and availability of resources that are lifesustaining for that population - Unemployment rate: The unemployment rate is the percentage of the labor force without a job It is a lagging indicator, meaning that it generally rises or falls in the wake of changing economic conditions, rather than anticipating them When the economy is in poor shape and jobs are scarce, the unemployment rate can be https://tailieuluatkinhte.com/ expected to rise When the economy grows at a healthy rate and jobs are relatively plentiful, it can be expected to fall - Poverty headcount ratio: National poverty headcount ratio is the percentage of the population living below the national poverty line(s) National estimates are based on population-weighted subgroup estimates from household surveys For economies for which the data are from EU-SILC, the reported year is the income reference year, which is the year before the survey year - Age dependency: The dependency ratio is a measure of the number of dependents aged zero to 14 and over the age of 65, compared with the total population aged 15 to 64 This demographic indicator gives insight into the number of people of nonworking age, compared with the number of those of working age It is also used to understand the relative economic burden of the workforce and has ramifications for taxation The dependency ratio is also referred to as the total or youth dependency ratio Overview of income inequality in the United States Income inequality is consistently a major topic in U.S presidential races Income inequality refers to how unevenly income is distributed throughout a population The less equal the distribution, the greater the income inequality Income inequality is often accompanied by wealth inequality, which is the uneven distribution of wealth Gini coefficient figures have ranked the U.S as one of the worst places for income equality among developed economies for many years now and this issue is only getting worse The reasons for growing inequality, according to economists, are multifaceted and include long-standing racial and gender discrimination, a failure to adjust to globalization and technological advancement, changing tax laws, and decreasing worker bargaining strength Equally diverse are the repercussions of inequality, which have widened societal gaps and intensified crises like the epidemic Additionally, inequality can undermine democracy and fuel moves toward authoritarianism. With a host of social ills—such as slavery, immigration problems, and Japanese internment camps—correlated with high levels of income inequality, it is crucial for the U.S to figure out how to reduce its income inequality Fortunately, history https://tailieuluatkinhte.com/ gives us a useful guide to policies that can be implemented to aid in that goal A brief history of income inequality in the U.S from the beginning of the 20th century until the present day shows that the nation's level of income inequality has been substantially affected by government policies concerning taxation and labor Barely 10 years past the end of the Great Recession in 2009, the U.S economy is doing well on several fronts The labor market is on a job-creating streak that has rung up more than 110 months straight of employment growth, a record for the post-World War II era The unemployment rate in November 2019 was 3.5%, a level not seen since the 1960s Gains on the jobs front are also reflected in household incomes, which have rebounded in recent years But not all economic indicators appear promising Household incomes have grown only modestly in this century, and household wealth has not returned to its prerecession level Economic inequality, whether measured through the gaps in income or wealth between richer and poorer households, continues to widen. From 2000 to 2018, the growth in household income slowed to an annual average rate of only 0.3% The shortfall in household income is attributable in part to two recessions since 2000 The first recession, lasting from March 2001 to November 2001, was relatively short-lived.7 Yet household incomes were slow to recover from the 2001 recession and it was not until 2007 that the median income was restored to about its level in 2000 The shortfall in household income is attributable in part to two recessions since 2000 The first recession, lasting from March 2001 to November 2001, was relatively short-lived Yet household incomes were slow to recover from the 2001 recession and it was not until 2007 that the median income was restored to about its level in 2000 But 2007 also marked the onset of the Great Recession, and that delivered another blow to household incomes This time it took until 2015 for incomes to approach their pre-recession level Indeed, the median household income in 2015 – $70,200 – was no higher than its level in 2000, marking a 15-year period of stagnation, an episode of unprecedented duration in the past five decades.8 More recent trends in household income suggest that the effects of the Great Recession may finally be in the past From 2015 to 2018, the median U.S household income increased from $70,200 to $74,600, at an annual average rate of 2.1% This is substantially greater than the average rate of growth from 1970 to https://tailieuluatkinhte.com/ 2000 and more in line with the economic expansion in the 1980s and the dot-com bubble era of the late 1990s The period from 2001 to 2010 is unique in the post-WWII era Families in all strata experienced a loss in income in this decade, with those in the poorer strata experiencing more pronounced losses The pattern in income growth from 2011 to 2018 is more balanced than the previous three decades, with gains more broadly shared across poorer and better-off families Nonetheless, income growth remains tilted to the top, with families in the top 5% experiencing greater gains than other families since 2011 The econometric model and variables selection: Income inequality can be measured using a variety of methods, such as the Lorenz curve (Lorenz 1905), the Gini coefficient (Gini 1913, 1921) and the Theil index (Akita el al, 1999) In this study, the team uses the Gini coefficient to represent income inequality GDP:Dr Barro(1991) is from the Department of Economics in Harvard University In his research, he finds that evidence shows little overall relation between income inequality and rates of growth and investment He thinks that economic growth will fall with greater inequality when GDP per capita is below around $2000 (1985 US dollars) and to rise with inequality when GDP per capita is above $2000 The data he uses dated through 1995 is from the World Bank Jauch and Watzka (2016) believe it is a good proxy for financial development, because the correlation between private credit over GDP and access to finance is high Since gross income excludes all income from non-private sources and net income includes all types of public transfers and deductions, they use both gross income and net income to measure income inequality so that the number reflects both the actual amount of an individual to spend on and also the individuals’ earning entitlements on pensions and other social benefits Their results suggest that economic theories predicting an income inequality reducing effect of financial development should be rejected Population: The level of income inequality varies greatly across localities, including between rural and urban areas Since 1970, non-metropolitan counties have tended to have much higher average levels of income inequality than metropolitan counties (Moller et al 2009; Thiede et al 2019) Although growth in urban inequality has led to significant rural-urban convergence in county-level 10