Howard Wial, executive director of the UIC Center for Urban Economic Development housed at GCI, and a nonresident senior fellow of the Metropolitan Policy Program at the Brookings Institution, is quoted in an article by the Chicagoist on why inequality is so high in Chicago, and other large cities.
Wial said factors such as tax rate reductions for the rich and the $7.25 federal minimum wage facilitate inequality. Wial said local minimum wages and the scarcity of sustainable jobs for people without a college degree lead to inequality because there are fewer opportunities for low-income residents.
“Policies that help create … good jobs for people who don’t have bachelor’s degrees are helpful,” Wial said. “The efforts that are just getting started around here … could be helpful, but we haven’t had much of that in the past decade or earlier.”
…
Although Chicago appears unequal, Wial said high inequality is to be expected because it characterizes the nature of a city. Cities offer both high-income jobs and minimum-wage jobs, which attracts a diverse demographic.
“Even in the best possible world, where inequality was as low as you could ever imagine it could be, places like Chicago would still have more inequality than places like Peoria, Ill.,” Wial said. “The fact that Chicago looks relatively bad in terms of inequality is not necessarily Chicago’s fault and not necessarily a flaw in the functioning of the economy.”
