Short Answer 
Wealth inequality refers to the unequal distribution of assets, leading to reduced consumer spending, slower economic growth, and fewer opportunities for investment. The concentration of wealth limits overall economic demand and can result in stagnation, while diminished buying power can cause supply and demand imbalances, impacting economic stability.
Step 1: Understanding Wealth Inequality
Wealth inequality refers to the uneven distribution of assets among individuals in society. Critics argue that this disparity can lead to significant societal problems. Key points include:
- Wealth concentration limits the spending capacity of the majority.
- Reduced consumer demand can result in slower economic growth.
- Opportunities for investment and job creation become restricted.
Step 2: Economic Growth and the Wealth Gap
The relationship between economic growth and wealth inequality is complex. Critics contend that the concentration of wealth can be detrimental over time. Important arguments include:
- When wealth is held by a few, it reduces overall economic demand.
- This limits opportunities for wider participation in the economy.
- Consequently, economic growth may stagnate due to limited spending power.
Step 3: The Impact of Buying Power on Economic Stability
Buying power is related to how much consumers can spend versus what is available in the market. A critical consideration is the following:
- If the majority’s purchasing power is diminished by wealth disparity, it can lead to supply and demand imbalances.
- This can indirectly increase inflation and undermine overall economic stability.
- Thus, wealth distribution impacts not just individual prosperity but also the broader economic system.