Income distribution, structure of economy and employment

The problem of poverty and growth in the developing world is simply this: that the products of growth are not equitably reaching the poor.

This book discusses in general terms the relation between economic growth and changes in the size distribution of incomes. One of the principal goals of the economic growth in poor countries is the reduction of both the open urban unemployment as well as of the hidden unemployment and underemployment in the rural areas. For that reason, special attention is given to the impact of changes in the distribution of income on the employment situation.

In the country case studies that follow, a specifically developed semi-closed static input-output model is applied to the Philippines, Iran, the Republic of Korea and Malaysia, in order to investigate the likely impact of hypothetical redistributions of income on employment and output. The model shows how such redistribution would raise employment but would not reduce imports.