Report
Patrick Artus

Income and wealth inequalities: A necessary evil that must be accepted, or a consequence of a shortcoming of the economy?

There are two presentations of inequality (income and wealth inequalities): Either it is a necessary evil to have technological progress and growth: innovations normally enrich those who make them and the companies that develop them; Or they reflect a shortcoming of the economy; this may be an abnormal skewing of income distribution at the expense of employees, or an abnormally low level of the employment rate which means that a high proportion of the population has no access to the labour market, or deindustrialisation. If the first version (necessary evil) of inequality is the right one, it must be accepted; if the second version (structural deficiencies of the economy) is the right one, it must be corrected, but the effective way to do so is then to correct the structural shortcomings of the economy, rather than trying to correct inequality ex post through redistributive policies. A comparison of OECD countries seems to show that: Income inequality reflects the shortcomings of the economy; Wealth inequality results from companies' innovation and development efforts.
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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