Financial Crises and Inequality: Exploring the Relationship between Delinquency and Greater Polarization

Abstract

High inflation, rising concerns around cost of living, the topic of finance and its related crises has seemingly been on the rise in the last few decades. Through understanding how financial/banking crises can be linked to inequality, it can be perceived as to whether inequality is simply inevitable and whether there are steps that can be taken in order to reduce its relevant extent. This essay will focus on leading up to, and following the Great Recession of 2007/2008 and find whether rising economic inequality has resulted in greater polarization overall. There is evidence to suggest that financial crises can cause and can result in an aftermath of great inequality however these effects may have varying levels of impact as well. Not only is understanding the relationship important, but the past can also provide answers for the future, especially relating to how inequality has been reduced and what methods have been drawn up at present to mitigate some of these issues.