1. Is It All About the Tails? The Palma Measure of Income Inequality
- Author:
- Alex Cobham and Andy Sumner
- Publication Date:
- 09-2013
- Content Type:
- Working Paper
- Institution:
- Center for Global Development
- Abstract:
- There are normative or instrumental reasons why inequality may be said to matter (e.g. fairness and meritocracy). However, much global literature has taken an instrumentalist approach as to why high or rising inequality can hinder development. For example, Birdsall (2007) argues that income inequality in developing countries matters for at least three instrumental reasons: where markets are underdeveloped, inequality inhibits growth through economic mechanisms; where institutions of government are weak, inequality exacerbates the problem of creating and maintaining accountable government, increasing the probability of economic and social policies that inhibit growth and poverty reduction; and where social institutions are fragile, inequality further discourages the civic and social life that underpins the effective collective decision-making that is necessary to the functioning of healthy societies.
- Topic:
- Economics, Poverty, Social Stratification, and Labor Issues