to work long hours to have income for large houses, fast cars and computers, luxury vacations, and the ability

to support children and grandchildren.

These factors all imply that a snapshot of inequality in a given year does not provide an accurate picture of how

people’s incomes rise and fall over time. Even if we expect some degree of economic inequality at any point in

time, how much inequality should there be? There is also the difference between income and wealth, as the

following Clear It Up feature explains.

CLEAR IT UP

How do you measure wealth versus income inequality?
Income is a flow of money received, often measured on a monthly or an annual basis. Wealth is the sum of the

value of all assets, including money in bank accounts, financial investments, a pension fund, and the value of a

home. In calculating wealth, one must subtract all debts, such as debt owed on a home mortgage and on credit
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