INCOME INEQUALITY IN THE UNITED STATES: A REVIEW AND ANALYSIS

Godpower O. Okereke
Texas A&M University-Texarkana
ABSTRACT
Studies (e.g., CBO, 2022; Chappell, 2019; Covert, 2016; Gordon, 2018; Johnston, 2021)
show that inequality has been increasing in the United States for decades and that it is getting
worse. One reason why this is happening relates to the skewed distribution of income over the
past five decades. For example, in 1970, the bottom 20% of Americans received 4.1% of total
income; the second quintile received 10.8%; the third quintile received 17.4%; the fourth quintile
received 24.5% whereas the top 20% received 43.3%. But by 2021, the bottom 20% received just
2.9%; the second quintile received 8.0%; the third quintile received 13.9%; the fourth quintile
received 22.6% whereas the top 20% claimed 52.7% (Statista Research Department, 2022). This
pattern of income distribution has made America more unequal than comparable G7 countries
(Zwart, 2019). This study is an exploratory investigation of the issues of inequality and
distribution of income in America in an effort to understand why things are the way they are. It
reveals that the level of inequality in America is higher than in comparable countries and still
rising (Jolly, 2005; Klein, 2020; McKay, 2022). The study also shows that government policies
and actions since the 1980s played the biggest role in widening the gap between America’s
wealthy individuals and everyone else. And since government actions have worked in the past to
reduce the level of inequality, the author therefore suggests that it is about time to start
implementing similar policies to avert the possible negative social, political, and economic
impacts of extreme level of inequality.
Keywords: Income inequality, US, workers union, gender, CEO compensation, Federal minimum wage, government
policies, Covid-19 pandemic