This report tries to find out the relationship between economic growth and income inequality in europe. The report compares Gini coefficients in last ten years with relevant GDP and suggests there is a positive correlation between economic growth and income inequality.Also there is a trade-off between income equality and economic growth. However, Deininger and Squire’s (1997) econometric test suggests there is no causal relationship between economic growth and income inequality. The report also analyses factors that can cause income inequality, such as globalization and technology advances. So economic growth is not to blame for the rising income inequality. Evidence shows low income group also benefit from economic growth. The last part of the report focuses on what kinds of policies government can adopt to reduce income inequality. Adjusting tax (including transfer payment) and reducing employment discrimination are two ways to reduce income inequality.
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发表于 2008-12-3 20:34:00
