Natural Inequality, Production and Economic Growth
Author(s)
Epstein, Gil S.; Spiegel, Uriel
Abstract
This paper explains why the effect of income inequality on productivity and growth is ambiguous. When income distribution exhibits inequality levels that are compatible with accepted criteria, productivity and growth ensue. When the divergence from an acceptable level of inequality occurs, then under certain conditions, we may expect lower (higher) production levels and lower (higher) levels of economic growth.
