1. Why do economists think that discrimination in the labor market is an unlikely explanation for the persistent inequality in earnings between women and men and among the races?
2. Suppose that the government redistributes income by taxing the 60 percent of households with the highest market incomes 10 percent, then distributing the tax collected as an equal benefit to the 40 percent with the lowest market income.
Calculate the distribution of income after taxes and benefits and draw the Lorenz curve
(i) before taxes and benefits and
(ii) after taxes and benefits.