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Abstract for:

Understanding the relationship between poverty, inequality and growth: a review of existing evidence

Abigail  McKnight,  July 2019
Paper No' CASE/216: | Full paper (pdf)
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Keywords: Poverty, inequality, growth

JEL Classification: I32; D31; O47

Is hard copy/paper copy available? NO - Paper Copy Out Of Print.
This Paper is published under the following series: CASE Papers
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Abstract:

This paper reviews the theoretical literature and empirical evidence on the relationship between poverty, inequality and economic growth. It finds evidence that economic inequality is good for growth as well as new convincing evidence that inequality is bad for growth. Variation in data quality, methodologies, the range of countries included in different studies makes it difficult to compare the evidence. A recent hypothesis that the relationship between inequality and growth might be non-linear, with very low and very high levels of inequality being harmful to growth but a range in between where the relationship is not clearly defined might provide a means to unify some of the conflicting findings.