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Pre -Reading For Wealth and Income

PRE -READING FOR WEALTH AND INCOME 5

Pre-Reading For Wealth and Income

Pre-Reading For Wealth and Income

Inpreparation for the lecture, I read a chapter from my course book onthe economics status in the UK, which game an overview of the topic.It explained the nature of competition of the supermarkets. Anderton(2008, p. 4) asserts that the UK supermarkets are an oligopoly sinceonly a few firms dominate the market. The companies are independent,and they are sometimes called the “big 4.” They include theMorrisons, Sainsbury, Tesco, and Asda (Anderton 2008, p.11). The UKretail market operates asymmetrically such that when one companyalters its price, the others will have to adjust its pricesaccordingly.

Ialso read an article from the financial times that the average incomein the UK between 2011 and 2012 was £ 26,200. However, some peopleworking full time were earning as little as little as £11,000 poundsper year. On the other hand, the top 10 % of the individuals withthe highest average income were earning above £52,600 per year(Brenner et al. 2000, p.6).

Accordingto Jones (2014, p.2), the UK has been experiencing drastic variationin income amount because of a variety of reasons including,alterations in employment patterns, enhanced returns from educationinvestment, changes in welfare policy and government tax, as well asthe effects of trade liberalisation. According to the researcher,people who have invested in technological education are able toacquire high returns from the education (International Associationfor Research in Income and Wealth 2001, p. 33).

Thechanging family incomes in the UK from 1970s to 2000s can beattributed to the fact that several women can now take jobs in thepublic and private sectors. As a result, many homes have two incomeearning person hence, the average income is quite high. On thecontrary, the rate of unemployment was higher in 2000s in the UK thanin 197s. Some families have more dependent and unemployed personsthan others, the difference in share of income in every household(Financial Times 2014, p.3).

References

Anderton,A. (2008). Economics, Harlow: Pearson Education.

FinancialTimes (2014). “Changing Views of Externalities,” Financial times.Available at http://www.ft.co. uk/comment/ft-view/10653904/&gt

Jones,W.(2014). “Externalities in the 21st Century,” Economic studies(online), March 7th. Available at: &lthttp://.www.economicstudies.com/business/2014/mar/2014/07/externalities.

INTERNATIONALASSOCIATION FOR RESEARCH IN INCOME AND WEALTH. (2001). Incomeand wealth. ser. 1- ser. 1-.Cambridge [Eng.], Bowes &amp Bowes.

Brenner,Y. S., Kaelble, H., &amp Thomas, M. (2000). Incomedistribution in historical perspective.Cambridge [England: Cambridge University Press.