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A new study (abstract and free PDF available) authored by several economists at the IMF (International Monetary Fund) reveal an inverse relation between increases in inequality and GDP growth. In what could also be considered a heavy blow to trickle-down economic theory, data analyses show (page 7) that increases of income share on the fifth quintile actually hurt growth, while increases in any other quintile favours growth with the lowest quintile showing the strongest push.
From the abstract:
We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth—that is, when the rich get richer, benefits do not trickle down. This suggests that policies need to be country specific but should focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class.
Original Submission
(Score: 3, Insightful) by Anonymous Coward on Friday June 19 2015, @07:47PM
Government confiscation
Taxation is not confiscation, shame on you for resorting to appealing to the reader's emotions.
of inheritance is immoral.
I disagree. Now that we find ourselves standing on the opposite ends on a nebulous subjective issue such as morality, perhaps we should find a better way to settle the discussion? Maybe if there was some scientific study which demonstrated the impact of wealth inequality...
The simple fact is in a free society inequality will always exist.
True, but that doesn't mean all forms of inequality should be given a free pass. Murder is inevitable in a free society, but we still outlaw it.
Those that advocate the use of force to tip the scales
In what way does anyone advocate the use of force? Are you claiming that enforcing laws are considered force?
are the advocates of tyranny.
Once again, using emotionally charged terms to sway opinion is intellectually dishonest.