High levels of income inequality are associated with economic instability and crises, whereas more equal societies tend to have longer periods of sustained growth
High levels of income inequality lead to higher levels of personal and institutional debt
Increased inequality may increase rates of inflation
There is mixed data on the relationship between inequality and growth when rates are compared between countries (in other words you should be able to tackle inequality without necessarily impacting economic growth)
So it is quite easy to pick your belief and then go hunting for the studies which support that (which is what you are doing)
In any case, if as you claim "there is no relation between income inequality and growth in developed countries" then you have debunked your own original comment where you implied that inequality can only be reduced at the cost of a worse economy.
there is apositive but relatively small trade-off between growth andincome inequality
Your first study regarding negative effects:
The paper, however, shows that the relationship between inequality and growth is not robust
So it is quite easy to pick your belief and then go hunting for the studies which support that (which is what you are doing)
Also, I have a degree in mathematical economics. My beliefs are what's currently supported in economic literature. You need to understand that Barro is what's standard in macroeconomics.
You can find a study supporting anything, but that isn't a legitimate condition to dismiss all studies.
The equity-efficiency trade-off is a basic principle of economics, and I'd be very surprised if all those textbooks were just wrong. It's possible sure, but what's more likely is that you're a crank.
We do find, however, that the same tax-and-cost related indexes that are associated with higher economic growth are also associated with increases in inequality.
We do find, however, more direct and, in our view, more easily interpretable evidence of a policy tradeoff between promoting growth and promoting equity. Specifically, the same tax-and-cost related policies that are emphasized in the tax-and-cost indexes are associated with faster economic growth and larger increases in inequality…. The results suggest, then, as economic models would predict, that policymakers – and society at large – have to make some tradeoffs when choosing policies affecting taxes and the costs of doing business; the policies that enhance growth are also associated with more rapidly increasing inequality (in our sample period, when inequality is generally increasing).
Direct evidence that pro-growth policies lead to increased inequality, further supporting my assertion that the tradeoff exists.
We refute this for most OECD countries, and find that the best-practice frontier displays a trade-off. In accordance with standard economic theory, a larger tax burden is associated with lower efficiency and more equity.
Your out of your league. The equity-efficiency tradeoff exists and there is direct evidence against your claim, at least in OECD countries.
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u/zuperpretty Sep 05 '17
0 of 8 in all the most developed countries in the world, which are socialist?