CAIE A-Level Economics 3.3.3 Economic Reasons for Inequality

CAIE A-Level Economics 3.3.3 Economic Reasons for Inequality
Cambridge International AS & A Level Economics 9708 syllabus for exams in 2026, 2027 and 20282026–2028

Practise explaining income and wealth inequality through skills, unemployment, discrimination, asset ownership and policy, then judging its household and economy-wide effects.

How this is tested

  • link structural unemployment, skill premiums or discrimination to a wider income distribution
  • explain how asset ownership, saving and inheritance can compound wealth inequality over time
  • evaluate incentive benefits against poverty, unequal living standards and social costs

Question 14

[Maximum number: 1]

The income Gini coefficient of a country changes from 0.29 to 0.33 over time.
What might explain this change?

A

an increase in food and energy subsidies

B

an increase in structural unemployment

C

an increase in the national minimum wage

D

an increase in the top rate of income tax