The existing literature on the matter of the effect of inequality upon growth is so ambiguous. Some authors found that redistributive policies are bad for growth (Alesina & Rodrik, 1994) others found that they are good for growth (Li & Zou, 1998). The most recent research argues that actually, inequality can be both good and bad (Van der Weide & Milanovic, 2018).
The aim of this project is to provide an insight into the current literature of new empirical evidence of the relationship between inequality, that is in its concept of income inequality, and economic growth. Furthermore, particular attention will be paid to the effect of education as a key element on economic growth.
The analysis will be focusing on European countries using micro-data from EU-SILC, the European Union Statistics on Income and Living Conditions.
In the last years, many economists highlighted the importance of having a more fair society and opportunities for all. This study aims to enrich the current literature of new empirical evidence of the relationship between inequality and economic growth across Europe. Throughout public policies on education, that can imply an increase in the quality and the quantity of education, it can be improved the role of individuals in the society.
The last economic crisis has had an important impact on this kind of policies and my purpose is to strengthen the idea that education is an important channel via which we can achieve the main objective of many policymakers that is economic prosperity since growing inequality has huge implications for the social stability and the overall efficiency of the economic and political system.