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Growth, inequality, and welfare: comparisons across space and time

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  • Carola Gruen
  • Stephan Klasen

Abstract

We propose and apply several welfare measures that combine average income with a measure of inequality to undertake cross-country comparisons of aggregate welfare for the 1970 to 2000 period. Our welfare measures, which are based on theoretical and empirical findings on the role of inequality in social welfare, drastically change the impression of levels of welfare, significantly affect the welfare ranking of countries in different benchmark years, affect changes in ranking over time, and affect convergence between industrialized and developing countries. While the results are sensitive to the type of inequality and its presumed effect on welfare, the results are robust to different ways to address comparability problems inherent in the inequality data used. Copyright 2008 , Oxford University Press.

Suggested Citation

  • Carola Gruen & Stephan Klasen, 2008. "Growth, inequality, and welfare: comparisons across space and time," Oxford Economic Papers, Oxford University Press, vol. 60(2), pages 212-236, April.
    • Handle: RePEc:oup:oxecpp:v:60:y:2008:i:2:p:212-236
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    File URL: http://hdl.handle.net/10.1093/oep/gpm042
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    Citations

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    Cited by:

    1. de Haen, Hartwig & Klasen, Stephan & Qaim, Matin, 2011. "What do we really know? Metrics for food insecurity and undernutrition," Food Policy, Elsevier, vol. 36(6), pages 760-769.
    2. Inmaculada Martínez-Zarzoso & Sebastian Vollmer, 2016. "Bilateral Trade Flows and Income Distribution Similarity," PLOS ONE, Public Library of Science, vol. 11(5), pages 1-12, May.
    3. Joachim De Weerdt & Kathleen Beegle & Jed Friedman & John Gibson, 2016. "The Challenge of Measuring Hunger through Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 64(4), pages 727-758.
    4. Baten, Joerg & de Pleijt, Alexandra M., 2022. "Female autonomy generated successful long-term human capital development: Evidence from 16th to 19th century Europe," World Development, Elsevier, vol. 158(C).
    5. Stephen Jenkins, 2015. "World income inequality databases: an assessment of WIID and SWIID," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 13(4), pages 629-671, December.
    6. Meysonnat, Aline & Muysken, Joan & Zon, Adriaan van, 2015. "Poverty traps: the neglected role of vitality," MERIT Working Papers 2015-052, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    7. Nanak Kakwani & Marcelo Neri & Hyun H. Son, 2006. "Linkages between Pro-Poor Growth, Social Programmes and Labour Market: The Recent Brazilian Experience," Working Papers 26, International Policy Centre for Inclusive Growth.
    8. Paul Koster, 2023. "Urban income inequality and social welfare," Tinbergen Institute Discussion Papers 23-009/VIII, Tinbergen Institute.
    9. David Castells-Quintana & Vicente Royuela, 2014. "Agglomeration, inequality and economic growth," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 52(2), pages 343-366, March.
    10. Anwar Shaikh & Amr Ragab, 2023. "Some universal patterns in income distribution: An econophysics approach," Metroeconomica, Wiley Blackwell, vol. 74(1), pages 248-264, February.
    11. Grimm, Michael & Harttgen, Kenneth & Klasen, Stephan & Misselhorn, Mark, 2008. "A Human Development Index by Income Groups," World Development, Elsevier, vol. 36(12), pages 2527-2546, December.
    12. Jan Luiten Zanden & Joerg Baten & Peter Foldvari & Bas Leeuwen, 2014. "The Changing Shape of Global Inequality 1820–2000; Exploring a New Dataset," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(2), pages 279-297, June.
    13. Kakwani, Nanak & Neri, Marcelo Côrtes & Son, Hyun H., 2010. "Linkages Between Pro-Poor Growth, Social Programs and Labor Market: The Recent Brazilian Experience," World Development, Elsevier, vol. 38(6), pages 881-894, June.
    14. Grunewald, Nicole & Klasen, Stephan & Martínez-Zarzoso, Inmaculada & Muris, Chris, 2017. "The Trade-off Between Income Inequality and Carbon Dioxide Emissions," Ecological Economics, Elsevier, vol. 142(C), pages 249-256.
    15. Gruen, Carola & Klasen, Stephan, 2012. "Has transition improved well-being?," Economic Systems, Elsevier, vol. 36(1), pages 11-30.
    16. David Castells-Quintana & Vicente Royuela, 2017. "Tracking positive and negative effects of inequality on long-run growth," Empirical Economics, Springer, vol. 53(4), pages 1349-1378, December.
    17. Peter J. Lambert & Subbu Subramanian, 2015. "Shaikh and Ragab's `Incomes of the Vast Majority': Some additions and extensions," Working Papers 354, ECINEQ, Society for the Study of Economic Inequality.
    18. Anwar Shaikh, 2018. "Some Universal Patterns in Income Distribution: An Econophysics Approach," Working Papers 1808, New School for Social Research, Department of Economics.
    19. Marina Malkina, 2017. "Social Well-Being of the Russian Federation Regions," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(1), pages 49-62.
    20. David Castells & Vicente Royuela, 2012. "Agglomeration, Inequality and Economic Growth: Cross-section and panel data analysis," ERSA conference papers ersa12p492, European Regional Science Association.

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