Abstract

Over the past decade, global output has grown by more than 3 percent a year and inflation has slowed in most regions. The fruits of this growthhave not been shared equally, however, and income disparities have grownin many countries, developed as well as developing. One of the mostpressing issues facing policymakers today is how to respond to these trends. To what extent are growth and equity complementary, and to whatextent is there a trade-off between the two? This Economic Issue is a summary version of an Issues Paper circulated at the IMF Conference on Economic Policy and Equity, held on June 8-9, 1998, at IMF headquarters.

The Economic Issues Series

Sanjeev Gupta is Chief, Expenditure Policy Division, of the IMF’s Fiscal Affairs Department. He holds degrees from Delhi, Oxford, and Simon Fraser Universities.

Benedict Clements, currently Senior Economist in the IMF’s European I Department, was educated at the University of St. Thomas and the University of Notre Dame.

Robert Gillingham, a consultant in the Expenditure Policy Division of the Fiscal Affairs Department, has degrees from Haverford College and the University of Pennsylvania.

Christian Schiller, a graduate of the University of Mainz, is Deputy Division Chief, Expenditure Policy Division, of the Fiscal Affairs Department.

Marijn Verhoeven, Economist in the Expenditure Policy Division of the Fiscal Affairs Department, was educated at Tilburg University.

Rosa Alonso-Terme, a graduate of the University of Barcelona and the Johns Hopkins University, is currently an Economist in the Fiscal Affairs Department.

Alexandros Mourmouras is an Economist in the Expenditure Policy Division of the Fiscal Affairs Department. He holds degrees from Harvard College and the University of Minnesota.