Income Inequality in the European Union and its relation to health and social problems

Bachelor Thesis from the year 2013 in the subject Business economics - Economic and Social History, grade: 1, , language: English, abstract: Why are health and social problems in the EU related to income inequality within countries, rather than per capita income? With regard to Wilkinson and Pickett's studies in 'The Spirit Level' (2010), I am demonstrating the relation of health and social problems with income inequality for EU countries and compare the results with the European Social Policy Models described by Boeri (2002) and Sapir (2005). At least since the 'Occupy Wall Street' and the 'We are the 99 percent' movements started to dominate newspaper headlines, the problem of unequally allocated disposable income has gained more attention by policy makers around the globe. In reconstruction times following WWII, gains in income have been shared almost equally between income quintile groups until the late 1970s - when the Great Convergence ended. Politicians and economists have therefore increased their interest in finding other indicators for economic performance rather than only casting an eye on GDP growth. I will thus investigate why health and social problems are far more related to income inequality rather than GDP growth or per capita income. To understand the situation especially in the European Union (EU) I will subsequently explain the underlying circumstances.