ADB: Asian Development Outlook 2012

Confronting Inequality in Asia

  • Developing Asia’s impressive growth continues, but is paced by a new challenge-inequality on the rise.
  • inequality of opportunity is also prevalent in developing Asia.
  • Inequality of opportunity is a crucial factor in widening income inequality in developing Asia.
  • Rising inequality can damp the poverty impact of economic growth.
  • Inequality can weaken the basis of growth itself.
  • Asian policy makers are becoming more concerned about inequality.
  • technological progress, globalization, and market-oriented reform- the primary drivers of the region’s growth- are the key forces behind the rise of inequality.
  • These forces affect income differences through three channels: capital, skill, and spatial bias.
  • Because the forces behind rising inequality are also the engines of productivity and income growth, policy makers should not hinder their progress.
  • Governments can address rising inequalities through several policy channels: efficient fiscal policies, interventions to improve regional balance, policies to make growth more employment friendly, and developing Asia mus turn back the tide of rising inequality.

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