Government-imposed barriers and the complex labor market serve to maintain existing inequalities. From an international point of view, the government-imposed restrictions are the number one cause of barriers that have led to economic inequality in many countries. In the 21st-century, international trade has been a source of hope to boost economic equality around the world. However, years after the industrial revolution, many countries are still struggling to account for the benefits of international trade.
For example, while countries like China, Singapore, and South Korea are rapidly developing and expanding their economies because of international trade, many governments in Africa are seeking new ways to limit international ties because of cultural differences. Subsequently, most domestic policies have caused a new challenge that arises at the intersection of international trade and the local administrations. As a result, these government-imposed barriers have served to maintain the existing economic gap across Africa and other continents.
Finally, current economic literature broadly points to the complexity of the labor market as one of the principal causes of income inequality and falling wages. Part of this challenge is attributed to the rapid technological development in the country and the growing knowledge gap among citizens. The combination of these two forces yields a multifaceted labor market, which can inexorably lead to policies that favor a specific group of citizens. For example, in the last few years, economists have observed that the Toronto region has become more divided by income inequalities because of the significant differences in interests and abilities.
However, knowledge gap and technological development barriers have made the income inequality issue in the region more pronounced. Recent studies show an increasing gap between the rich and the poor across the country, but the GTA remains the inequality capital of Canada. Therefore, through these forces, the intertwined and complex nature of the labor market has played a crucial role in maintaining existing income inequalities in Toronto and Canada at large.