Inequality has emerged as a key concern for people across the world. In the US , rising inequality is likely to be a main point of debate in the next year’s presidential election. In China , although millions of people have been lifted out of poverty in the last 30 years, the gini coefficient has risen rapidly, raising concerns about the affordability of many things for the common people.
Last year’s surprise bestselling book, “Capital in the 21st Century” by Thomas Piketty, also focused on measuring and explaining the long-term trends in inequality in wealth.
I will try to examine some evidence related to inequality. I also will discuss the link between inequality and growth, i.e. whether higher growth leads to higher/lower inequality, and, what is perhaps a harder question, whether higher inequality leads to higher/lower growth.