Focusing on differences in the amount people actually spend on goods and services as a measure of their material well-being rather than comparing their current incomes leads to a focus on _____ in discussions of the level of economic inequality across households.

Question

Quizplus · Accepted Answer

Focusing on consumption instead of income captures a more accurate measure of one's material well-being since it reflects the actual goods and services that a household is able to purchase and consume. Thus, differences in consumption levels can reveal disparities in household economic well-being and provide a better indication of economic inequality across households.

Focusing on Differences in the Amount People Actually Spend on Goods