Assessing the effects of population change, economic growth, and globalization on income inequality

Publication Date: January 2003

Publisher: East-West Center

Author(s): Jeffrey G. Williamson; Matthew Higgins

Research Area: Economics; Population and demographics

Type: Brief

Abstract:

A recent analysis covering income-inequality data from 92 countries over four decades suggests that inequality tends to increase at early stages of economic development and fall at later stages. The most important determinant of inequality is not economic growth, however, but rather changes in population age structure. These population changes occur as mortality and fertility drop during the course of economic and social modernization. This analysis suggests that policies that make health and family planning services widely available will contribute to a reduction in income inequality by lowering mortality and fertility rates.