tries? The answer is assumed to be a number in the higher rank. In fact, in most LCD’s, the G.C. is about 0.5 to 0.7 or even higher. This shows us that the problem of income inequality is very seriously in those countries. “We were taught to take care of our GNP as this will take care of poverty. Let us reverse this and take care of poverty as this will take care of poverty.” Poverty became the key problems in the late 1960s and early 1970s. Those who are concerned with the “well-beings of the poor in developing countries eventually paid special attention to the effects of development policies on the poor and also introduce policy measures that are specifically designed to help them directly.” There are many ways to deal with the problem of income distribution. The major concern of the policies would be the approach to provide human basic needs (HBN) for each and every one of the people in the country. In nearly all of the LDC’s, majority of the people are living under absolute poverty. This means that they are not able to provide a standard level of living for themselves. Different policies to improve the income inequality and also procure an economic growth include land reform, redistribution of saving and investment, education for all, progressive taxation, public expenditures from tax revenues and birth control.Some people think that there existed a trade-off between growth and equity. They think that distributing income too equally would undermine incentives and thus lower everyone's income. They believed that the rich needed special encouragement to save and invest more in order to cause a growth in the economy. Recent evidence suggests that this conventional wisdom is wrong. Many economies in Asia - Hong Kong, Indonesia, Malaysia, the Republic of Korea, Singapore, Taiwan (province of China) and Thailand - have had both rapid growth and relatively low inequality. “Between 1960 and 1993 t...
