Income Inequality as a Main Social Challenge for the European Union | Chapter 4 | Current Strategies in Economics and Management Vol. 8

 The poverty rate and the preservation of cross-country social and economic inequality are a big social issue for the European Union and are likely to have significant economic repercussions for its society. In general, the current levels of poverty and social exclusion in the European Union are strong, considering that it is the continent with the largest share of the world's GDP. It is the duty of both the European Union and its Member States to take immediate economic recovery steps and to take emergency measures. Hey. Growth. Poverty reduction, which is also a major objective of the Europe 2020 plan, but which has not yet obtained the requisite results, should be the main objective. It has proven very difficult to achieve its goal of saving at least 20 million people from poverty and social exclusion by 2020, both in the short and the long term. This paper aims to explore one of the most important issues for the culture and economy of the European Union today: on the one hand, poverty and social exclusion and, on the other, income inequality. These two indicators are examined at the level of the EU and as discrepancies between EU Member States, as evidenced by a lack of social cohesion. The interdependence between economic development and poverty and social exclusion within the EU has been studied and proved to be negative. The interdependence between economic growth and income inequality (Gini coefficient) in the EU has been studied and has been shown to be positive. The key factors of income inequality in the EU are analysed in the second part of the paper. The national social policy and social model of the Member States, the current disparities in individual opportunities, the negative effects of economic globalisation, rapid technological change, the tendency to undermine the position of trade unions, etc. The chapter concludes with a brief overview of the possible problems facing the European Social Model.

Author (s) Details

Monika Moraliyska
University of National and World Economy, Bulgaria.

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