Level: SL and HL. Sections marked HL only are for Higher Level students.
Economic growth does not guarantee that everyone benefits. This topic shows how inequality and poverty are measured, what causes them, and how taxes and spending can reduce them.
3.4.1 Equality and equity
Definition
Equality means everyone has the same share of income, wealth or opportunity.
Equity means fairness. An equitable distribution is one society judges to be fair; it usually involves reducing large inequalities, but not necessarily removing them.
Most economists accept some inequality as a reward for effort, skill and risk-taking. The debate is about how much inequality is fair, and about equality of opportunity: whether everyone has a fair chance to succeed.
🔒 Also in the full notes
- 3.4.2 The meaning of economic inequality
- 3.4.3 Measuring economic inequality: the Lorenz curve and Gini coefficient
- 3.4.4 The meaning of poverty
- 3.4.5 Measuring poverty
- 3.4.6 Causes of economic inequality and poverty
- 3.4.7 The impact of income and wealth inequality
- 3.4.8 The role of taxation in reducing poverty and inequality
- 3.4.9 Further policies to reduce poverty and inequality
- Exam practice: 5 questions with mark allocations
- 2 exemplar answers with full model answers and examiner commentary
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