[quote] The idea that increased income inequality makes economies more dynamic has been rejected by an International Monetary Fund study, which shows the widening income gap between rich and poor is bad for growth.
A report by five IMF economists dismissed “trickle-down” economics, and said that if governments wanted to increase the pace of growth they should concentrate on helping the poorest 20% of citizens.
The study – covering advanced, emerging and developing countries – said technological progress, weaker trade unions, globalisation and tax policies that favoured the wealthy had all played their part in making widening inequality “the defining challenge of our time”.
The IMF report said the way income is distributed matters for growth. “If the income share of the top 20% increases, then GDP growth actually declines over the medium term, suggesting that the benefits do not trickle down. In contrast, an increase in the income share of the bottom 20% is associated with higher GDP growth,” said the report. [/quote]
Thoughts?
Edit: That feel when you can tell everyone is just liking the bobcast comment and moving on instead of commenting.
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3 RepliesEdited by DeadSoul103: 6/16/2015 8:13:06 PMI don't have a source for this so you can search it up, but supposedly if a poor and a wealthy person were to be given $1,000,000 dollars, both would spend it in different ways. The poor individual would more than likely spend it on wants and go on a crazy shopping spree, and the wealthy person would more than likely invest it, and purchase wanted items after they profited more cash out of the million given. Giving more money to the poor won't help, they'll just spend it on non-necessities. Education though, will assist the poor population, because the key to making money is saving it, investing it, and profiting off of it. Btw, I went to an economically disadvantaged high school, and please elaborate why the teens who were supposedly "poor" (according to themselves) would have the lastest smart phone, would brag about a new console/game that they've purchased, would talk about watching shows on cable, having a decent car, etc. Some of these people who I've interacted with also live government housing areas, yet they still have more shit, than I do.