Economics Income Inequality Questions
The Kuznets curve is an economic theory that suggests that income inequality initially increases as a country develops economically, but eventually decreases as the country reaches a certain level of economic development. The curve is named after economist Simon Kuznets, who proposed this relationship in the 1950s. According to the theory, in the early stages of development, income inequality tends to rise as certain sectors or individuals benefit more from economic growth. However, as the country progresses and more people participate in the economy, income inequality starts to decline. This is often attributed to factors such as increased education, technological advancements, and government policies aimed at reducing inequality.