Inequality reduces growth

Recently the IMF Managing Director, Christine Lagarde, said:

“Our research shows that, if you lift the income share of the poor and middle class by 1 percentage point, then GDP growth increases by as much as 0.38 percentage points in a country over five years. By contrast, if you lift the income share of the rich by 1 percentage point, then GDP growth decreases by 0.08 percentage points.”

(Source)

So much for higher inequality incentivising hoi polloi to work harder and thus boost GDP growth

See more David Horsey cartoons here.