Trade and Development Report 2012

In the context of the ongoing fallout from the global financial crisis, income distribution is back to the centre of economic analysis and policies. This publication explores the linkages between income distribution, growth and development. It analyzes the evolution of income inequality over the last decades in different regions and groups of countries. It also examines the explanations given for the widespread rise of inequality. The report questions the thesis that rising inequality is a necessary condition for successful development. Based on a comprehensive theory of economic policy elaborated in former reports, this book argues that only inclusive development policies create the conditions for sustainable and rapid growth.