Economic Growth and Income Inequality: Reexamining the Links

Many economists have long believed that income dispari-ties increase in the early stages of development, making the poor relatively worse off. Recent research suggests that an unequal distribution of income can hamper growth. What does the evidence show? CONOMISTS have long sought to understand the links between eco-nomic growth and income distri-bution. The main issues, listed below, have important policy implications for developing countries