Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/128564
Authors: 
Kang, Jong Woo
Year of Publication: 
2015
Series/Report no.: 
ADB Economics Working Paper Series 447
Abstract: 
Inclusive growth should ensure "broad-based" economic growth which characterizes the pattern of growth. Beyond simple association identification implied by the Kuznets curve and cross-country panel regression analyses, this study attempts to shed light on the dynamic causality relationship and impact channel between economic growth and inequality - using vector error correction model (VECM) and vector autoregression (VAR) models for individual economies. If growth has a negative impact on inequality, renewed attention should be paid to curbing inequality. Those economies experiencing inclusive growth can further promote growth with less risk of sacrificing equity. This also provides useful implications for development interventions through designing and monitoring projects and programs. Given the growing challenges of reducing inequality, economies could create a proper inequality target as a binding constraint in pursuing economic growth, instead of using a growth-first and redistribution-later strategy.
Subjects: 
dynamic causality
economic growth
inequality
JEL: 
C32
O1
O4
Persistent Identifier of the first edition: 
Creative Commons License: 
http://creativecommons.org/licenses/by/3.0/igo/
Document Type: 
Working Paper

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