Final answer:
Since the late 1970s, income inequality in the U.S. economy has increased due to changes in household structures and 'winner take all' labor markets, which have resulted in greater wage disparities and a concentration of wealth among top earners.
Step-by-step explanation:
To answer how the inequality of income has changed in the U.S. economy since the late 1970s, one must recognize that it has increased. Income inequality can be measured using quintiles, which divides households into groups that contain an equal fraction of the population, or by tools like the Lorenz curve, which illustrates the distribution of income across a population.
Two main factors have been attributed to the rise in income inequality: changes in household structures and the increasing polarization of wages in the economy. The advent of 'winner take all' labor markets and disparities in education and skillsets have widened income differences. Additionally, the rising trend of two-earner couples and single-parent families has affected household incomes differently, contributing to greater disparity.
Since the late 1970s, the earnings of the highest quintiles have grown much more than those of the lower quintiles, leading to a greater concentration of wealth among the top earners. Further supported by statistics, CEO pay has risen by over 298 percent, indicating a sharp increase in income at the top while median incomes for most segments of the population have stagnated or even declined.