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Lecture Development economics - Lecture 9: Re-Distribution with Growth (RWG)

The reports of ILO, World Bank and other international agencies promoted this view that along with economic growth there should be a fairer distribution of incomes. Therefore, the economists present a set of four theories to attain the combination of economic growth and fairer distribution of wealth. | 1. Re-Distribution with Growth (RWG) 2. Millennium Development Goals (MDGs) Lecture 9 Re-Distribution with Growth (RWG): The reports of ILO, World Bank and other international agencies promoted this view that along with economic growth there should be a fairer distribution of incomes. Therefore, the economists present a set of four theories to attain the combination of economic growth and fairer distribution of wealth. By following them individually or collectively the incomes of lower classes can be increased. However, how such methods will be implemented depends upon the social and economic conditions of a country. Theories or Methods of Income Distribution: (1) To enhance the growth of GNP by raising the savings, and allocate the resources in a better way so that all the sections of the economy could be equally benefited. (2) To take steps to get education, loans and other public services for the poorest sections of the society. (3) The fiscal systems of the countries be devised in such a way that the distribution of income could move in favor of the poor class. (4) The existing assets of the countries be mobilized in favor of the poorest class as the case of taking up Land Reforms. Components of RWG: (1) As far as growth of GNP is concerned it is a necessary condition to remove the poverty, but it is not a sufficient condition. Just depending upon growth it will require a greater time on the part of the poor people to increase their incomes. As there exists a weaker relationship between the incomes of the poor people and the remaining economy, therefore, the incomes of the poor class will always lag behind the overall growth of the economy. No doubt, the poor class will also be benefited as compared with no rise in GNP, yet, to avail the better benefits due to the strategy of growth of GNP, some package of redistribution will have to be implemented. (2) As far as the matter of raising of the incomes of the poor is concerned, govts. should . | 1. Re-Distribution with Growth (RWG) 2. Millennium Development Goals (MDGs) Lecture 9 Re-Distribution with Growth (RWG): The reports of ILO, World Bank and other international agencies promoted this view that along with economic growth there should be a fairer distribution of incomes. Therefore, the economists present a set of four theories to attain the combination of economic growth and fairer distribution of wealth. By following them individually or collectively the incomes of lower classes can be increased. However, how such methods will be implemented depends upon the social and economic conditions of a country. Theories or Methods of Income Distribution: (1) To enhance the growth of GNP by raising the savings, and allocate the resources in a better way so that all the sections of the economy could be equally benefited. (2) To take steps to get education, loans and other public services for the poorest sections of the society. (3) The fiscal systems of the countries be .