Republic of uzbekistan ministry of higher education, science and innovations

The Causes of Inequality
In one sense, the growth of inequality in the last part of the twentieth century comes as a surprise. In the 1950s, the bottom part of the income distribution contained large concentrations of two kinds of families: farm families whose in-kind income was not counted in Census data, and elderly families, many of whom were ineligible for the new Social Security program. Over subsequent decades, farm families declined as a proportion of the population while increased Social Security benefits and an expanding private pension system lifted elderly incomes. Both trends favored greater income equality but were outweighed by four main factors.
-Family structure. Over time, the two-parent, one-earner family was increasingly replaced by low-income single-parent families and higher-income two-parent, two-earner families. A part of the top quintile’s increased share of income reflects the fact that the average family or household in the top quintile contains almost three times as many workers as the average family or household in the bottom quintile.
-Trade and technology. Trade and technology increasingly shifted demand away from less-educated and less-skilled workers toward workers with higher education or particular skills. The result was a growing earnings gap between more- and less-educated/skilled workers.
-Expanded markets. With improved communications and transportation, people increasingly functioned in national, rather than local, markets. In these broader markets, persons with unique talents could command particularly high salaries. -Immigration. In 2002, immigrants who had entered the country since 1980 constituted nearly 11 percent of the labor force (see immigration). A relatively high proportion of these immigrants had low levels of education and increased the number of workers competing for low-paid work.
Conclusion
These factors, however, can explain only part of the increase in inequality. One other factor that explains the particularly high incomes of the highest-paid people is that between 1982 and 2004, the ratio of pay of chief executive officers to pay of the average worker rose from 42:1 to 301:1, and pay of other high-level managers, lawyers, and people in other fields rose substantially also.
As noted above, both CPS and SOI statistics measure pretax money income. These measurements are deficient for three reasons. First, increases in governmental aid to the poor have been concentrated in nonmoney benefits such as Medicaid and food stamps and through tax credits under the Earned Income Tax Credit (EITC). Nonmoney benefits are excluded from standard statistics, and EITC tax credits are typically underreported. Second, an increasing proportion of wage-earners’ total compensation goes to health insurance and pension benefits—which are not counted in standard statistics. Third, taxes themselves modify the income distribution.
The U.S. Census has attempted to correct these definition problems for recent years by estimating the household income distribution under alternative income definitions. Table 2 shows the effect in 2001 of moving from the standard Census definition (pretax money excluding capital gains) to an adjusted definition that includes the estimated effects of capital gains, taxes, the EITC, and the monetary value of private and governmental nonmoney benefits. The result is a substantial reduction in inequality, with the ratio between incomes in the top and bottom quintiles falling from $14.31:$1.00 to $10.40:$1.00. Similar adjustments for selected earlier years indicate that better income measurement reduces inequality in any single year. Even under the adjusted definition, though, the trend toward increasing inequality in the 1980s and 1990s remains, but at a slower pace.