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Why economists are finally taking inequality seriously - The Week

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This began to change with work, such as a paper by Jonathan D Ostry, Andrew Berg, and Charalambos Tsangarides of the IMF showing that societies with more unequal distributions of income tend to grow slower, and that redistributing income does not have a negative effect on economic growth. It may even help economies to grow faster. The exact mechanism for this is unknown, though the paper suggests that "excessive inequality is likely to undercut growth — for example by undermining access to health and education, causing investment-reducing political and economic instability, and thwarting the social consensus required to adjust in the face of major shocks."