Final answer:
Income distribution refers to how income is allocated among different groups within an economy. It measures inequality, can be tracked using methods such as Lorenz curves, and has been affected by changes in household dynamics and technology. Redistribution efforts such as government welfare programs aim to address income inequality.
Step-by-step explanation:
The way in which income is allocated among families, individuals, or other designated groups in the economy is described as income distribution. This involves measuring inequality by dividing the population into groups, such as quintiles, and calculating the share of income received by each group. Another method is drawing Lorenz curves to visualize the distribution. In the United States, changes in the structure of households and the impact of new information and communications technology have been cited as causes for the increase in income inequality since the late 1970s. To address inequality, redistribution methods take income from those with higher incomes and provide it to those with lower incomes, applying policies like TANF, the earned income tax credit, SNAP, and Medicaid.