I was delighted to be involved in the preparation of the research report by the Chifley Research Centre – “Inequality: The Facts and the Future”
The report is at this link: https://www.chifley.org.au/Inequality-the-facts-and-the-future
It was released today and it outlines a range of critical issues relating to income and wealth inequality, but the key issues for me related to how reductions in inequality can be positive for economic growth.
In a nutshell, the marginal propensity to consume is greater for low income earners than high income earners, so greater progressivity in income tax scales and well targeted transfer payments support economic growth.
A cheeky person might suggest that rather than negative interest rates and fiscal stimulus to kick start the global economy, a revenue neutral redistribution from the very high income earners to low income earners would help kick start the global economy.
It is also apparent that a healthy and well educated workforce is good for economic growth. Having workers with the requisite skills is vital for the business sector to expand and build profits, as is having a healthy population that reduces sick leave days or time off to look after sick family members.
It seems so simple.
Giving access to people of all incomes access to high quality education and skills training, and world best health care is good for economic growth.
Read the report and let me know what you think.