Discussion Papers, Ibero America Institute for Economic Research 89
Regardless of the importance of growth, there are still some reasons to have a closer look at the “equity-growth-relation”. This will be shown in section 2. In some cases the issue of inequality might be neglected because it does not hinder but rather stimulate economic growth. The poor might benefit from this process even with an increasing inequality. This case will be discussed in section 3. Inequality, on the other hand, may be an impediment to economic growth and it cannot be neglected if one accepts that “growth matters”. Section 4 is dedicated to this issue. In section 5 the possibilities are discussed of combining economic growth with decreasing inequality, and section 6 contains some conclusions.