Essay On The Impact Of Inequality On Development

I. Introduction

“We now have considerable evidence that equity is also instrumental to the pursuit of long-term prosperity in aggregate terms for society as a whole.” Issue of inequality is very much relevant nowadays, as it keep affecting our world in many ways, while continuing to increase all over the world. There have numerous researches interested in this topic, trying to examine different ways in which inequality can affect society and its relationship with development. The most common way to estimate impact of inequality would be to examine its impact on growth of per capita income, as it is considered to be a universal measure for economic performance and well-being of a country. However, there is no agreement on whether it has positive or negative effect or even no effect at all.
The aim of the paper is to figure out the impact of inequality on development. The hypothesis is as follows: inequality has a negative effect on development of a country. This paper can be considered as another argument to the already existing literature focusing on the negative impact of inequality on development. It examines the relationship between inequality and economic development. Development cannot be

There are three different data sets that will be used this paper. All three data sets use countries taken from one of the World Bank regions – Europe and Central Asia. The World Bank's regional classifications is defined on the basis of per capita income meaning that only developing countries are taken into account, while rich countries are excluded from the regions of the World Bank. I include Western Europe back into the Europe and Central Asia Region and have the list of countries that is listed in Appendix 1. It is important to note at this moment that the use of countries slightly differs depending on what data set is being used due to the absence of some data for some