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Go karts use a variety of rear axle types. The most common for DIY types is the single wheel drive, but two wheel drive karts are also popular. The simplest of these is the live axle, and the more complicated use a differential.
A live axle means that the wheels are mounted directly to the axle, and the axle spins. A dead axle would be where the wheels spin freely and the axle does not turn.
Live Axles for Traction
A live axle on a go kart means that the engine will power both rear wheels at the same speed and power. This is accomplished with a single sprocket mounted to the live axle.
Since both wheels are locked in to the power all the time, off road go karts often use a live axle. When both wheels are turning at the same time, you'll have twice the traction. This is great for sand, loose dirt, etc, where a single wheel would often spin out.
This is not to say that live axles don't have their drawbacks. Unfortunately for the on-road set, a live axle means that turning is difficult. This is because both rear wheels turn at the exact same speed.
When making a turn, the outside wheel must be able to spin faster than the inside wheel. If they are forced to turn at the same rate by a live axle, then the outside wheel must slip on the driving surface in order to turn as fast as needed.
That's easily accomplished on dirt and sand; the outside wheel can slip without problem. But on hard dirt and roads, the wheels have much more traction, and therefore it's harder for that wheel to slip.
A more complicated solution to this problem is to use a differential on the rear axle, just like a car has. This allows both wheels to be powered, and allows for easy cornering. However, it's not the best solution for serious off roading. This is because when traction is lost on one wheel, it will spin and the other won't turn at all, effectively giving you a single-wheel drive. These systems are readily available for less than $100.
Single Wheel Drive (Fixed Axle)
If you plan to use the kart for serious off roading, then a live axle is the way to go. But for hard-pack and asphalt, you can't beat a single wheel drive for the price.
A single wheel drive runs a chain from the engine clutch straight to the drive wheel, which has a sprocket mounted directly to it. The other rear wheel is left to spin free-wheel.
A single wheel drive is by far the easier and cheaper than a differential, and give you the needed slip for on-road and hard pack dirt driving.
Many parts houses sell complete assemblies that have the rear wheel, sprocket, and brake as one. This will save you some cash and simplify the need to match bolt hole patterns for independently purchased pieces.