The Growth-versus-Equity Debate in Development Strategy

A recurring debate in development planning concerns how much emphasis a country's overall strategy should place on maximising the rate of growth versus ensuring that the benefits of growth are distributed equitably as they arise.

A growth-first view holds that an economy should prioritise maximising the overall rate of output growth, on the reasoning that a larger total output gives the economy more resources to eventually redistribute, and that redirecting resources toward redistribution too early can slow the very growth needed to generate those resources in the first place. This view is broadly associated with the growth-mediated strategies discussed earlier in this chapter.

An equity-first (or redistribution-first) view holds that growth alone cannot be relied upon to reduce poverty and inequality within an acceptable time frame, and that deliberate redistributive measures — land reform, progressive taxation, targeted social spending, direct employment programmes — must accompany growth from the outset rather than being deferred until growth has "delivered" enough resources. This view is broadly associated with the direct poverty-alleviation strategies discussed earlier. …