Relationship Between Inequality And Economic Growth

Introduction Since the establishment of the People’s Republic of China in 1949 with its government socialist ideology, planned economy during the economic reforms, which started in 1978 and are still going on until nowadays, China has had continued presence of inequality. In my work I overview the evolution of inequality that could be divided into two historical periods: pre-reform period (1949-1978) and the reform period (1978- onwards). I also examine the correlation between inequality and economic growth in China. Although, with the sustained economic development and increase of living standards for the last three decades, China’s uneven regional development has been a serious phenomenon. During the time of triple transition that includes decentralization, modernization and globalization the nature of regional development and its inequality has been changed fundamentally. Inequality has become the engine of progress; I argue that nowadays inequality in China is unavoidable for future development. Pre-reform period Geographically China is divided into three parts: western, central and eastern (coastal) regions. Based on the historical development, natural resources, and climate they have their own distinctions. The new government considered development imbalance as an important issue because of three significant factors. First, the interior labor market was far away from coastal area. The second factor is the raw materials and energy supply were far away from coastalShow MoreRelatedBenefits Of Income And Assets Inequality Essay1462 Words   |  6 PagesIntroduction: Income and assets inequality is a significate issue in economy. Throughout human history capital and assets will likely continue to accumulate and become more concentrated, as a result that an greater level of inequality might be witness. Piketty ( 2014 ) found that the rate of GDP growth is lower than return on capital. This Piketty s famous rg inequality shows that assets tend to accumulate faster than the rate of economic growth in capitalist societies which means capital distributionRead MoreInequality Of Economic Growth And Inequality1699 Words   |  7 PagesEconomic growth and inequality has been a long debated topic but is more important in the recent decades as income inequality has dramatically grown within many countries; the implications on these can hinder social and political development. Economic growth and its link to Equality can help create stability for an economy and improve living standards in the long run. More directly it allows people to be able to contribute and engage in the economy as it provides the opportunity for employment, investmentRead MoreThe Effect of Income Inequality on Economic Growth1341 Words   |  5 Pagessomebody wonders why did I choose the subject of inequality the previous lines are exactly the reason. The hypothesis I will try to prove further in my paper is that the striking gap between rich and poor population in the world cannot lead to economic growth. Furthermore, Human Capital is considered to be the main force that stimulates economic growth. But now that human capital is scarcer that machines, widespread education has become the secret to growth. However, education is hardly accessible toRead MoreSources Of Economic Growth And Social Justice Essay1402 Words   |  6 Pages3.1 Sources of Economic Growth and Social-Justice Egyptian per-capita income has been significantly improved in the second half of the first decade of 21st century, as it recorded, in average, $1984 (standard deviation $167), compared to $1312 (standard deviation $597), in average, during the first half of the decade. Figure (1) illustrates the development of per-capita income through the first decade of 21th century and it shows that per-capita income growth rates were, in most, negative duringRead MoreRelationship Between Income Inequality And Financial Sector Development969 Words   |  4 PagesFinancial development boosts economic growth have been shown by the increasing number of scholars, however whether the financial sector development could benefits the income distribution is still controversial. Under this question, this essay try to use statistically method to explore the relationship between income inequality and financial sector development. This essay’s results present that inequality decreases as financial development. Although there are some weak evidence suggests that thereRead MoreImpact Of Trade Liberalization On African Countries Essay1627 Words   |  7 PagesThe scholarship examining the extent at which trade liberalization (henceforth refers to as economic globalization) impacts poverty levels is limited. This essay examines the relationships between economic globalization and poverty levels in African countries. For instance, a 2006 UNDP report illustrates that just 7.2 percent of Bayelsa and Rivers State (Nigeria) residents were poor in 1980, but in 2004, the poverty index figures rose exponentially to 44.3 percent; Nigeria’s national rural povertyRead MorePoverty Inequality And Economic Growth1466 Words   |  6 PagesThe purpose of this essay is to investigate the extent in which poverty, inequality and economic growth are related. These three dimensions are regularly perceived as indices of the complex and multidimensional concept of ‘economic development’. This term is not black and white however: it is a concept that is more than just merely income analysis. Poverty can be broken down into two separate definitions: absolute and relative. Absolute poverty describes the position of an individual who is livingRead MoreThe Great Gatsby By F. Scott Fitzgerald867 Words   |  4 Pagesaspiration of economic success. The â€Å"visceral topic† is questioned, â€Å"Does income inequality impair the American dream of upward mobility?† In the beginning, Mr. Robert Rosenkranz provides the audience with a comparison of one’s income to a ladder with many rungs. He sets a perspective about the increase in inequality creating a difficulty or perhaps a neutrality of mobility within our capitalist economy. The importance of the issue brings a rise in discussion about the relationship between social positionsRead MoreEducation And Income Inequality : New Evidence From Cross Country Data Essay927 Words   |  4 Pagespublished â€Å"Education and Income Inequality: New Evidence from Cross-Country Data† in the early 2000s (Gregorio Lee, 2002). This paper looks at empirical evidence on how educational factors, like higher educational attainment and equal distribution of education, play a significant role in income distribution. The authors Gregorio and Lee state that many other literature pieces emphasize education as one of the major factors affecting the degree of income inequality (Gregorio Lee, 2002). GregorioRead MoreTo What Extent Do Democracies Affect A Nation s Poverty?1578 Words   |  7 Pagesimperative to note because poverty rates have increased every year and with these new technologies, developing democratic countries could look at the United States as a future example on how to decrease poverty. Such ways to decrease poverty includes economic growth, which allows for more job opportunities. These job opportunities will boost the overall economy in all structures of government, which will later decrease the poverty rates within the host country. Both informal and formal job opportunities are