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Growth, Inequality and Social Protection

  • Roman Arjona
  • Maxime Ladaique
  • Mark Pearson

Economic growth is, ultimately, the result of the myriad of transactions which take place in a market economy. Similarly, the distribution of income depends on who has ownership of factors of production, how much they can sell them for, and whether the resultant income is redistributed or not. It would be surprising were economic growth and income distribution not to be linked. But how exactly they might be linked has been the topic of many competing theories and empirical evaluations. Unfortunately, the studies have not led to a convergence on a common view that there is, or is not, a trade-off between the two goals of an equitable society and a rich one. This lack of enlightenment becomes less surprising once the empirical studies are examined in detail. Many empirical studies have looked at the final distribution of income, when some of the theories make stronger predictions about the links between growth and the distribution of income before taxes and transfers; similar ... La croissance économique est, en fin de compte, la résultante des multiples transactions qui se déroulent dans une économie de marché. De même, la distribution du revenu dépend de l’identité des propriétaires des facteurs de production, du revenu qu’ils peuvent escompter de la vente de ces facteurs et du point de savoir si ce revenu est redistribué ou non. Il serait étonnant qu’il n’y ait pas de lien entre la croissance économique et la distribution du revenu. Quant à savoir quel est exactement ce lien, c’est là un thème auquel ont été consacrées maintes théories et évaluations empiriques concurrentes. Malheureusement, ces études n’ont pas permis d’aboutir à des conclusions convergentes sur le point de savoir s’il y a ou non relation inverse entre ces deux objectifs que sont une société équitable et une société riche. Cette situation apparaît moins surprenante lorsqu’on examine précisément les études réalisées. De nombreuses études empiriques considèrent la distribution finale ...

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Paper provided by OECD Publishing in its series OECD Labour Market and Social Policy Occasional Papers with number 51.

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Date of creation: 29 Jun 2001
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Handle: RePEc:oec:elsaaa:51-en
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