【正文】 he poverty line because the poverty line is an absolute rather than a relative standard. ? Despite continued economic growth in average ine, the poverty rate has not declined. ? Although economic growth has raised the ine of the typical family, the increase in inequality has prevented the poorest families from sharing in this greater economic prosperity. Copyright 169。 2020 SouthWestern Problems in Measuring Inequality ? Data on ine distribution and the poverty rate give an inplete picture of inequality in living standards because of the following: ? Inkind transfers ? Life cycle ? Transitory versus permanent ine Copyright 169。 2020 SouthWestern Economic Mobility ? The movement of people among ine classes is called economic mobility. ? Economic mobility is substantial in the . economy. Copyright 169。 2020 SouthWestern Utilitarianism ? Utilitarianism is the political philosophy according to which the government should choose policies to maximize the total utility of everyone in society. ? The founders of utilitarianism are the English philosophers Jeremy Bentham and John Stuart Mill. Copyright 169。 2020 SouthWestern Libertarianism ? Libertarianism is the political philosophy according to which the government should punish crimes and enforce voluntary agreements, but should not redistribute ine. ? Libertarians argue that equality of opportunity is more important than equality of ine. Copyright 169。 2020 SouthWestern MinimumWage Laws ? Advocates argue that the demand for unskilled labor is relatively inelastic, so that a high minimum wage depresses employment only slightly. ? Critics argue that labor demand is more elastic, especially in the long run when firms can adjust employment more fully. Copyright 169。 2020 SouthWestern InKind Transfers ? Inkind transfers are transfers to the poor given in the form of goods and services rather than cash. ? Food stamps and Medicaid are examples. Copyright 169。 2020 SouthWestern Antipoverty Programs and Work Incentives ? Workfare refers to a system that would require any person collecting benefits to accept a governmentprovided job. Copyright 169。 2020 SouthWestern Summary ? Liberals would determine the distribution of ine as if we were behind a “veil of ignorance” that prevented us from knowing our own stations in life. ? Libertarians would have the government enforce individual rights but not be concerned about inequality in the resulting distribution of ine. Copyright 169。 2020 SouthWestern Summary ? Data on the distribution of ine show wide disparity in our society. ? The richest fifth of the families earns about ten times as much as the poorest fifth. ? It is difficult to gauge the degree of inequality using data on the distribution of ine in a single year. Copyright 169。 2020 SouthWestern Antipoverty Programs and Work Incentives ? Many policies aimed at helping the poor can have the unintended effect of discouraging the poor from escaping poverty on their own. Copyright 169。 2020 SouthWestern Negative Ine Tax ? A negative ine tax collects tax revenue from highine households and gives transfers to lowine households. Copyright 169。 2020 SouthWestern MinimumWage Laws ? Advocates view the minimum wage as a way of helping the working poor. ? Critics view the minimum wage as hurting those it is intended to help. Copyright 169。 2020 SouthWestern Liberalism ? Liberalism is the political philosophy according to which the government should choose policies deemed to be just, as evaluated by an impartial observer behind a “veil of ignorance.” ? This view was originally developed by the philosopher John Rawls. Copyright 169。 2020 SouthWestern POLITICAL PHILOSOPHY OF REDISTRIBUTING INCOME ? What should the government do about economic inequality? ? Economic analysis alone cannot give us the answer. ? The question is a normative one facing policymakers. Copyright 169。 2020 SouthWestern Problems in Measuring Inequality ? The Economic Life Cycle ? The regular pattern of ine variation over a person’s life is called the life