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Inequality Undermines Democracy and Growth

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  • Thorvaldur Gylfason

Abstract

Income equality and trust seem to go along with several other ingredients of social capital as determinants of economic growth across the globe. In a large sample of countries, equality in the distribution of income as measured by the World Bank and by The Standardized World Income Inequality Database are seen to be correlated with economic diversification, the rule of law, transparency as measured by the corruption perceptions index from Transparency International, trust as measured in the World Values Survey, and democracy, all of which are good for growth as reflected in the purchasing power of per capita national income.

Suggested Citation

  • Thorvaldur Gylfason, 2019. "Inequality Undermines Democracy and Growth," CESifo Working Paper Series 7486, CESifo.
    • Handle: RePEc:ces:ceswps:_7486
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp7486.pdf
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    References listed on IDEAS

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    Cited by:

    1. Mohtadi, Soran & Castells-Quintana, David, 2021. "The distributional dimension of the resource curse: Commodity price shocks and income inequality," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 59, pages 63-78.
    2. John Komlos, 2021. "Macroeconomic Inequality from Reagan to Trump. Market Power, Wage Repression, Asset Price Inflation, and Industrial Decline," The Economic Record, The Economic Society of Australia, vol. 97(318), pages 450-453, September.
    3. Maham Zahra Mehdi & Danish Ahmed Siddiqui, 2020. "The Effect of Polarization on Economic Growth, Social Capital, and Democracy: A Cross-Country Study," Issues in Economics and Business, Macrothink Institute, vol. 6(1), pages 42-66, June.
    4. Flavio Delbono, 2020. "Le diseguaglianze in Italia nella stagione del Covid-19," QUADERNI DI ECONOMIA DEL LAVORO, FrancoAngeli Editore, vol. 2020(111), pages 73-86.

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    More about this item

    Keywords

    inequality; social capital; democracy; growth;
    All these keywords.

    JEL classification:

    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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