East Asian economies have experienced rapid growth over three decades, with relatively low levels of income inequality, and appear to have also achieved reductions in income inequality. We argue that policies that reduced poverty and income inequalities, such as emphasizing high-quality basic...

New empirical evidence suggests that high levels of income inequality constrain rather than encourage growth. While some explanations involve relationships between inequality and political systems, this paper focuses on the microeconomic behavior of poor households. When returns to labor are...