Income Inequality and Uneven Wealth Flashcards

What does "income inequality" mean in 1920s America?

Most money went to a small rich group. Many people had low pay.

What is the difference between income and wealth?

Income is the money you earn each year. Wealth is what you own, like savings and property.

By 1929, how much of national income did the richest 5% receive?

About one third of all income.

Which areas and groups often had the lowest incomes in the 1920s?

Rural areas, especially the South. Farm workers, African Americans, and many immigrants.

How did wages compare with company profits in the 1920s?

Wages rose a little. Company profits rose much faster.

How did weak trade unions affect pay?

Many unions were kept out. Workers had little power to demand higher wages.

What does underconsumption mean, and how did low incomes cause it?

It means people cannot buy enough goods. Low wages left many unable to buy new products.

How did uneven wealth make the 1920s economy fragile?

The economy relied on rich buyers. When their spending fell, demand dropped and firms cut jobs.

How did 1920s tax policy affect income inequality?

Taxes on high incomes and companies were cut. The rich kept more money, widening the gap.

You’ve used 10 of your 10 free revision notes for the month

Sign up to get unlimited access to revision notes, quizzes, audio lessons and more

Sign up