Work, Poverty & Welfare



Monies received by an individual over a specified time period (usually a year.)

This includes:

-         Salary

-         Rental income

-         Pension

-         Benefits

-         Dividends (interest on savings)

Earned income: money received for doing something (paid employment)

Unearned income: from investments e.g. dividends, stocks, shares, rents, benefits (passive income from unpaid employment)

Disposable income: amount left after taxes

Discretionary income: amount available to spend after essential items have been bought



A stock of financial and real assets.

It comes from:

-         Inheritance

-         Educational success (good investments/saved income)

-         Premium bonds/lottery (by chance)

-         Entrepreneurship (hard work/running own business)

Marketable wealth: any type of wealth that can be sold and its value realised e.g. land, cars, savings

Measuring Wealth

Problems With Measuring Wealth

Looking at savings accounts

-         Can’t always check bank balances

Surveys of wealth

-         Untruthful

-         Tax evasion

-         Below tax brackets

-         Some reluctant to give info

Inheritance tax statistics

-         Out of date figures

-         Wealth passed on before death/ misses out IHT

-         Poor are excluded from IHT


-         Cannot put value on wealth



UK Distribution of Wealth

-         Richest 20% own 60% of all wealth

-         Poorest 20% own 0.6% of all wealth

Wealth inequality has grown due to……

-         The recession

-         Country has become more right wing leading to privatisation

-         Increased house prices

HOWEVER…. Individual effort and achievement aren’t the only factors that contribute to success

-         Some degree of luck

-         Opportunities (right place, right time.)

-         Certain rules and UK policies can act in your favour


Theoretically, the growth in inequality is due to…

Marxist: Inequality is caused by Capitalism and exploitation of the w/c

Functionalist: Inequality serves a function, by giving the w/c hope and something to strive towards and it allows people to be at the top

Weberian: Competition means that not everyone can be wealthy, the group who end up on the top will try to stay there


Kersley and Shaheen (2014)

Globalisation: increased outsourcing leads to undermining of low skilled workers in MEDCs leading to a growing divide between high and low skilled workers

Technology: computerisation has led to job losses of less skilled people e.g. checkout workers

Government Redistribution: narrowing of economic equality by reducing income tax rates from 85-45%

Trade Unions: shift towards deregulated labour markets and the reduction in power of trade unions

Financialisation: financial sectors increase relative to overall economy meaning the wealthier become wealthier with industry becoming less important

Political Capture: democracy is led by higher income and higher wealth voters meaning politics doesn’t always represent lower incomes as eagerly.







Inheritance Tax: owe 40% on anything over £325,000 or 36% if you leave 10% or more to charity.

Direct Taxes: straight from


No comments have yet been made