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Article: INCOME INEQUALITY

Article from:
Regional Economist
Article date:
October 1, 2006
Author:
Copyright

Time for Predatory Lending Laws?

Income inequality, the gap between the rich and the poor, seems to indicate a higher probability of a predatory lending law being adopted. States that recently adopted predatory lending laws had higher than average levels of income inequality over the past 10 years than their nonadopting counterparts.

Predatory lending-an illegal activity by lenders or brokers leading to a further decrease of well-being of relatively poor individuals-could generate greater inequality between individuals in the U.S. economy. Predatory lending laws, the laws aimed at reducing fraudulent lending activity, may do the most good in reducing inequality in states where inequality is ...

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