Inequality and Growth: Uncovering the Main Conclusions from the Empirics

This paper is a critical survey of the empirical literature on the effects of inequality on economic growth. We conclude that it is most likely that the disparities found in the results are due to differences in the type of countries and time periods included in the samples, the variable used to measure inequality, the structure of the data, and the estimation techniques. These findings suggest that the mechanisms that link inequality to growth are likely to operate differently in different circumstances, an element that may offer important guidelines for both policy makers and researchers.