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Social Inequality: Evidence and Patterns

The distribution of income and wealth

  • 3 things to know
  • A2 Unit 4

Overview

How inheritance sustains inequality across generations, distinction between original and disposable income and how the tax and benefit system redistributes income.

What you need to know

Answer each one before you reveal it.

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Key term

Distinguish income from wealth.

Key term

Give three sources of income other than earnings.

Key term

Give three forms in which wealth is held.

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    Distinguish income from wealth.

    Model answer

    Income is money received over a period, whereas wealth is the stock of assets a person owns at a point in time.

  2. 2

    Give three sources of income other than earnings.

    Model answer

    State benefits, pensions and returns on investments.

  3. 3

    Give three forms in which wealth is held.

    Model answer

    Property, pension entitlements and financial investments.

  4. 4

    Which is more unequally distributed in Britain, income or wealth?

    Model answer

    Wealth, because assets accumulate and are inherited, whereas income differences are narrowed by taxation and benefits.

  5. 5

    Explain how inheritance sustains inequality across generations.

    Model answer

    Assets passed from parents to children give advantages in housing, education and security that were not earned by the recipient.

  6. 6

    What is meant by the distinction between original and disposable income?

    Model answer

    Original income is what a household receives before state intervention; disposable income is what remains after benefits are added and direct taxes deducted.

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