Structural Change, Inequality and Inclusive Growth: Tensions and Trade-offs (Academic Panel)

Organised by the ESRC GCRF Global Poverty and Inequality Dynamics Research Network

Most of the world’s poor live in countries that have since the Cold War experienced rapid economic growth and substantial rises in average income per capita, unequivocal structural change of GDP, employment and exports away from agriculture, and an increase in the disparity of national income shares between the richest and the poor. The UN goal of ending global poverty by 2030 will require that high growth rates are sustained and that growth is inclusive and shared across society so that poverty reduction in maximised. The former, high and sustained growth, is best driven by structural change. This is not least to avoid a growth slowdown or a contested ‘middle-income trap’. However, structural change is associated with rising disparities between the rich and poor. In contrast, inclusive growth is best achieved with steady or falling inequality to maximize poverty reduction. How to manage this tension or trade-off between structural change and inclusive growth is a crucial contemporary question for developing countries as they seek to end poverty as well as to pursue economic development.The proposed panel(s)will addressthisfundamental tension between sustaining high economic growth rates that require structural change and typically drive up disparities whilst at the same time making growth inclusive, which entails steady or even falling inequality to maximise poverty reduction.

The core questions are: (i) What model of economic development would ensure rapid economic growth and structural change with an expanding share of national income for the poor? And (ii) how are governments to use public policy to manage the trade-off between structural change and inclusive growth? Further questions include, for example, where is political mass support for the creative-destructive processes that drive structural change to come from? Which economic and institutional arrangements mediate the inherentsocio-economic trade-offs of structural transformations in the most equitable way?

Andy Sumner & Lukas Schlogl, King’s College, London
Kunal Sen, Manchester University
Arief Yusuf, Padjadjaran University, Indonesia
Tony Addison, UNU-WIDER, Helsinki (tbc)
Alberto D. Cimadamore, CROP, International Social Sciences Council, University of Bergen