Holding all other factors constant, income earned from capital is more unequally distributed than income earned from labour.

Question

Quizplus · Accepted Answer

This statement is true. Income earned from capital is often concentrated in the hands of a small percentage of the population, such as wealthy investors or shareholders. On the other hand, income earned from labor is distributed more widely across the population, with many individuals earning salaries or wages. Additionally, capital gains from investments are often taxed at lower rates than ordinary income, which further exacerbates income inequality.

Holding All Other Factors Constant, Income Earned from Capital Is