Inequality’s Toll on Growth

by iMFdirect

Inequality is one of the defining issues of our time, so you may want to tune in to this interview with the authors of a new study that shows that  higher inequality leads to lower growth.  You can also read their blog here.

It turns out that making the rich richer by one percentage point lowers GDP growth in a country over five years by 0.08 percentage points—whereas making the poor and the middle class one percentage point richer can raise GDP growth by as much as 0.38 percentage points.

 

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