Economic Growth, Income Equality, and Population Health among the Asian Tigers

Abstract

The “Tiger” economies of Southeast Asia provide examples of developing nations where economic growth and increasing income equality are compatible and, when occurring together, are associated with superior health trends over time. The degree of income inequality in the Asian Tigers declined during the period of rapid economic growth. Traditionally, economists have viewed economic growth and relative parity in income distribution as incompatible, or trade-offs. This poses a public policy dilemma, since a reasonable propensity to increase a nation's overall economic well-being would mean forsaking measures that increase income parity. The Asian Tigers, however, have shown that this need not be viewed as a trade-off. Economic growth and a simultaneous increase in income equality are possible and, with respect to health outcomes, desirable. The authors propose a variety of mechanisms through which income inequality can enhance economic growth, and discuss policies in education, agricultural land reform, and housing that influence the simultaneous attainment of income equality and economic growth.