Pub. date: 2008 | Online Pub. Date: May 28, 2008 | DOI: 10.4135/9781412963930 | Print ISBN: 9781412941655 | Online ISBN: 9781412963930| Publisher:SAGE Publications, Inc.About this encyclopedia
Marina A. Adler
Wealth disparities exist both within and across societies. The distribution of income and wealth within any given society is a reflection of its class structure. Individual wealth is the total accumulated value of people's assets or property, commonly referred to as their “net worth.” Specifically, net worth is the value of all cash-convertible assets minus the value of all debts. Wealth is distinguished from income in that it includes assets that have a market value and that can generate income, such as dividends from stocks, bonds, or real estate. In contrast to income, which tends to be spent on living expenses, wealth generates more wealth via interest and dividends and is a phenomenon that endures over generations. Thus, wealth allows the rich to get richer. Even though income and wealth are clearly related, the distribution of wealth reflects more inequality than that of income. In the United States, more so ...