There are many different types of economic systems used across the world. Most economies are a unique blend of market economics and central planning. While the vast majority of economic transactions today are characterized by the exchange of goods for currency, other economies, like that of Papua New Guinea’s Kula Ring, envision exchange in a different way. In the Kula Ring, trade exists to facilitate the tradition of systematic gift-giving.
Despite their differences, all systems of exchange are based upon the belief that interdependence is necessary to the functioning of society, whether that be in accessing essential goods or upholding social tradition.
Have Only a Few Minutes to Learn More About Economics?
The Undercover Economist by Tim Harford
Thinking Fast and Slow by Daniel Kahneman
Naked Economics: Undressing the Dismal Science by Charles Wheelan
Basic Economics: A Common Sense Guide to the Economy by Thomas Sowell
MIT Principles of Microeconomics Lecture Series
The Armchair Economist by Steven Landsburg
Dive Deeper into Economics
Addressing economic inequality requires a global response. Here are some organizations that you can get involved with!
Oxfam America Take Action
UNICEF USA Clubs Program for youth
Concern Worldwide’s Concern Active
The Hunger Project Youth in Action
Action Against Hunger School Fundraisers for Charity
Economic inequality refers to the uneven distribution of wealth in a society. It is most commonly measured by the Gini coefficient, which ranges from zero to one, with a value of zero indicating complete income equality and a value of one corresponding to a situation in which one household earns all of a country’s income. Due to factors such as globalization, technological advancement, and the decline of unions, income inequality has been on the rise in many countries since the 1980s (click here to see the latest numbers on income inequality across the world). In most societies, economic inequality does not affect everyone equally. For example, in the US, black women are paid just 62 cents to every dollar earned by white men. Learn more about economic inequality by exploring the resources provided below.
Six Policies to Reduce Economic Inequality by John A. Powell
Quantifying America’s Gender Wage Gap by Race/Ethnicity
The Consequences of Economic Inequality by Nicholas Birdsong
Short Video: A Look at Income Inequality by TIME
Do you think high levels of economic inequality hurt everyone? How so?
How do factors such as race and gender affect people’s economic opportunity?
How does economic inequality affect children? Are all children born with the equal opportunity to succeed economically?
Is economic inequality related to other aspects of society such as education and the criminal justice system?
What policies can governments implement to reduce economic inequality?
Capital in the 21st Century by Thomas Piketty
“How Can Governments Respond to Income Inequality?” from the OECD library
Why Nations Fail by Daron Acemoglu and James A. Robinson
Evicted: Poverty and Profit in the American City by Matthew Desmond
The Price of Inequality by Joseph Stiglitz
Globalization & Global Economic Inequality
Economic globalization has led to many positive impacts, including more efficient markets, faster transnational information flows, and ultimately higher standards of living. However, the wealth that globalization has generated is not equally spread out across the world. In fact, according to the UNDESA World Social Report 2020, income inequality has increased in 71 percent of countries over the past 25 years. Covid-19 is exacerbating these inequalities, as many people in poorer areas of the world are unable to afford or access adequate healthcare. Growing economic inequality in the era of globalization underscores the fact that interdependent relationships are not always equal.
How Does the Global Economy Work?
Watch this recent TED interview with Kristalina Georgieva, managing director of the IMF, about the global economic response needed to address Covid-19.
How will the world’s priorities when it comes to the global economy? Watch this conversation by the IMF.
How has globalization positively and negatively impacted the world?
Further discussion questions can be found on the Carnegie Council for Ethics in International Affairs’ website, here.
How will the global economy be impacted by the Covid-19 pandemic?
How has the South Asian economy been impacted by the pandemic?
What does gender disparity look like in the economic sphere?
Disposable People by Kevin Bales
Development as Freedom by Amartya Sen
The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality by Branko Milanovic
A Beginner’s Guide To The World Economy by Randy Charles Epping
Interdependence Web Grocery Store exercise
In our increasingly globalized world, it is very rare for an individual or a family to survive completely on their own. Our world is so economically integrated that the production and transportation of the things that we use in our daily lives require a global effort. For example, when you buy an apple at the grocery store for $1.50, that interaction between you and the cashier is the last in a long line of exchanges that got that apple into your hand. Before arriving at your grocery store, the apple was picked by an apple picker, transported by a truck driver, and placed in a heap for you to grab by a grocery clerk. Pick a food item that you often buy at the grocery store and consider the series of exchanges that got that item into your hand. Recognize that even in this small way, your experience depends on so many other people.
Check out an animation of this exercise.
After completing the exercise and watching the animation, consider these two questions:
- How has globalization positively and negatively impacted the world?
- And, what surprised you about this exercise and animation?