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Inequality and Growth in a Panel of Countries

Robert J. Barro
Journal of Economic Growth
Vol. 5, No. 1 (Mar., 2000), pp. 5-32
Published by: Springer
Stable URL: http://www.jstor.org/stable/40216021
Page Count: 28
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Inequality and Growth in a Panel of Countries
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Abstract

Evidence from a broad panel of countries shows little overall relation between income inequality and rates of growth and investment. For growth, higher inequality tends to retard growth in poor countries and encourage growth in richer places. The Kuznets curve--whereby inequality first increases and later decreases during the process of economic development--emerges as a clear empirical regularity. However, this relation does not explain the bulk of variations in inequality across countries or over time.

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