A three-year programme of research on the connections between inequality, and poverty funded by the Joseph Rowntree Foundation is currently led by CASE, in collaboration with the International Inequalities Institute.
A podcast and slides from The Relationship between Inequality and Poverty: mechanisms and policy options, a public lecture hosted by LSEWorks in February 2017 is now available to play and download.
Below Abigail McKnight, CASE Associate Director and project researcher summarises some of the conceptual issues and existing evidence base on the links between poverty and inequality. The project includes expanding the evidence base through empirical analysis of the relationship between income inequality and poverty using a variety of measures both for the UK over time, and across countries. An understanding of the mechanisms that drive this relationship will be used to help explore policy options.
Societies with low levels of relative income poverty generally also have low levels of income inequality , although the strength of the relationship varies and there are cases where inequality and poverty trends have moved in different directions. An understanding that these two phenomena are inextricably linked has given rise to large international organisations (World Bank; UN; WEF; Oxfam) setting joint inequality-poverty reduction targets on the basis that poverty cannot be seriously tackled without addressing inequality. Understanding what drives the strength of the relationship between inequality and poverty and what factors can weaken the relationship involves the study of inequality and poverty measures; theoretical underpinnings; mechanisms that drive the relationship; and, effective policies.
There are also important dynamic mechanisms which help to shape the relationship between inequality and poverty. Higher inequality is often associated with lower mobility (we saw this for earnings over the 1980s) making it harder to escape poverty. Evidence of a positive relationship between inequality and intergenerational mobility (the so-called ‘Great Gatsby Curve’) suggests that poverty risks are more likely to be passed from parents to children where/when inequality is higher. Limited downward mobility driven by the ability of better-off families to hoard the best opportunities for their children can limit the extent to which children growing up in poverty can be upwardly mobile.
Improving the Evidence Base for Understanding the Links between Inequalities and Poverty is funded by the Joseph Rowntree Foundation. The views expressed are those of the authors and not necessarily those of the funder www.jrf.org.uk
 Atkinson, A.B. (2015), Inequality: What can be done?. Cambridge, Mass.: Harvard University Press.
 Toth, I. (2014) [GINI Vol 2] “Revisiting Grand Narratives of Growing Inequalities: Lessons from 30 Country Studies”, in Salverda et al. (eds) Changing Inequalities and Societal Impacts in Rich Countries: Thirty Countries’ Experiences. Oxford: Oxford University Press; Forster, M. and Vleminckx, K. (2004), International comparisons of income inequality and poverty: Findings from LIS. Socioeconomic Review 2 (2): 191-212.
 World Bank (2014). A Measured Approach to Ending Poverty and Boosting Shared Prosperity: Concepts Data and the Twin Goals, Policy Research Report 2014, WEF (World Economic Forum) (2015). The Inclusive Growth and Development Report 2015, by Samans, R., Blanke, J., Corrigan, G. and Drzeniek, M.
 Bucelli, I. (forthcoming) ‘Inequality, poverty and the grounds of our normative concerns’, Working paper from JRF funded programme of research on understanding the link between inequalities and poverty. CASE, LSE.
 Karagiannaki, E. (forthcoming) ‘Exploring the poverty and inequality link: new empirical findings’, Working paper from JRF funded programme of research on understanding the link between inequalities and poverty. CASE, LSE.
 McKnight, A. (forthcoming) ‘Labour market inequality and the links between income inequality and poverty’, Working paper from JRF funded programme of research on understanding the link between inequalities and poverty. CASE, LSE.
 Yang, L. (forthcoming) ‘Reviewing the evidence on mechanisms that drive the relationship between inequality and poverty: part 1’, Working paper from JRF funded programme of research on understanding the link between inequalities and poverty. CASE, LSE.
 Stiglitz, J. (2012). The price of inequality: how today’s divided society endangers our future. New York: W.W. Norton and Co.
 Bonica, A., McCarty, N., Poole, K.T. and Rosenthal, H. (2013). Why hasn’t democracy slowed rising inequality? Journal of Economic Perspectives 27(3), 103-124.
 Lacey, N., and Soskice, D. (2013). “Why Are the Truly Disadvantaged American, When the UK Is Bad Enough? A Political Economy Analysis of Local Autonomy in Criminal Justice, Education, Residential Zoning.” SSRN Electronic Journal.
 Duque, M., and McKnight, A. (forthcoming) ‘Reviewing the evidence on mechanisms that drive the relationship between inequality and poverty: part 2’, Working paper from JRF funded programme of research on understanding the link between inequalities and poverty. CASE, LSE.
 Dickens, R. and McKnight, A. (2008). ‘Changes in earnings inequality and mobility in Great Britain 1978/9-2005/6’, CASEpaper 132, London: Centre for Analysis of Social Exclusion.
 Alan Krueger referred to the “Great Gatsby Curve” for the first time in a speech. “The Rise and Consequences of Inequality”, to the Center for American Progress on January 12, 2012, in his capacity as the Chairman of the Council of Economic Advisors. Evidence of this relationship has been noted by others including Andrews and Leigh (2009) and Corak (2013).
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