{
  "title": "Topic 5: Enhancing Inclusion",
  "sourceUrl": "https://www.imf.org/en/topics/low-income-countries/macro-research-for-development/enhancing-inclusion",
  "canonical": "https://www.imf.org/en/topics/low-income-countries/macro-research-for-development/enhancing-inclusion",
  "overlayPath": "/en/topics/low-income-countries/macro-research-for-development/enhancing-inclusion/index.md",
  "summary": "Despite strong growth over the past two decades, income inequality remains high in many low-income countries (LICs).",
  "sections": [
    {
      "heading": "Context and motivation",
      "content": "- Despite strong growth over the past two decades, income inequality remains high in many low-income countries (LICs).\n- The ongoing COVID-19 crisis is disproportionally affecting people in already vulnerable situations and has spurred a renewed focus on distributional issues.\n- High levels of inequality can impair the sustainability of growth and macroeconomic stability, limiting countries’ ability to achieve smooth recovery and reach the Sustainable Development Goals.\n- Reducing gender gaps can have important economic benefits: gender equality can boost productivity, enhance economic resilience, and reduce income inequality."
    },
    {
      "heading": "FCDO-IMF partnership — phases and focus",
      "content": "- Phase 1 (March 2012 to March 2015)\n  - Aim: build distributional analysis into macroeconomic models and examine the link between fiscal policy and income inequality.\n  - Achievement example: a high-level conference on Fiscal Policy and Income Inequality in Sub-Saharan Africa.\n  - Outputs recorded for year 1, year 2, and year 3 of the FCDO-IMF partnership.\n- Phase 2 (April 2015 to March 2017)\n  - Aim: build and apply tools to describe and predict distributional consequences of macroeconomic policies, incorporating distributional factors; place gender more squarely in IMF policy-oriented research.\n  - Key achievement: development of the macroeconomic and distributional analysis model (MDAM), a framework to evaluate the distributional impacts of various macroeconomic policies, applied to several countries.\n  - Additional outputs: a paper on Macro-Structural Policies and Income Inequality in Low-income Developing Countries; a series of papers on gender budgeting for Asia, Caribbean and Pacific Islands, Europe, Middle East and Central Asia, Sub-Saharan Africa, and Western Hemisphere; conferences on Macroeconomic Policy and Income Inequality and on Gender and Macroeconomics.\n  - Outputs recorded for year 4 and year 5 of the FCDO-IMF partnership.\n- Phase 3 (April 2017 to March 2020)\n  - Focus: inequality and gender and their intersection; expanded training courses and dissemination.\n  - Achievements:\n    - Applications of the inequality toolkit on Benin and Dominica.\n    - Applications of the gender budgeting toolkit on Nigeria, Sri Lanka, and Rwanda.\n    - An SDN on Women in the Labor Force: The Role of Fiscal Policies.\n    - A paper on the distributional effects of capital account liberalization.\n    - High-level conferences on gender equality and inclusive growth.\n  - Outputs recorded for year 6, year 7, and year 8 of the FCDO-IMF partnership.\n- Phase 4 (April 2020 to March 2025)\n  - Focus areas:\n    - Gender equality and sustainable growth, including how the COVID-19 pandemic has affected gender inequality and the channels and trade-offs between different policies to address country-specific gender gaps.\n    - Quantifying short-run and long-run welfare implications of revenue mobilizations using different tax instruments.\n  - Outputs to be recorded for years 9–13 of the FCDO-IMF partnership."
    },
    {
      "heading": "Tools, methods, and dissemination",
      "content": "- Development and application of analytic tools to assess distributional impacts:\n  - Macroeconomic and Distributional Analysis Model (MDAM).\n  - Inequality toolkit.\n  - Gender budgeting toolkit.\n- Production of thematic papers and SDNs linking macro-structural policies, fiscal policy, capital account liberalization, and gender to distributional outcomes.\n- Delivery of conferences and training courses to foster research discussions and disseminate findings on macroeconomic policy, income inequality, and gender."
    },
    {
      "heading": "Key implications for policy research and practice",
      "content": "- Integrating distributional analysis into macroeconomic modeling is central to understanding the equity implications of fiscal, structural, and external policies in LICs.\n- Gender-focused analysis and gender budgeting are important complements to distributional macroeconomic frameworks for promoting inclusive growth.\n- Policy evaluation should consider both short-run and long-run welfare implications, particularly when assessing revenue mobilization via different tax instruments and post-COVID recovery strategies."
    }
  ],
  "bullets": [
    "Despite strong growth over the past two decades, income inequality remains high in many low-income countries (LICs).",
    "The ongoing COVID-19 crisis is disproportionally affecting people in already vulnerable situations and has spurred a renewed focus on distributional issues.",
    "High levels of inequality can impair the sustainability of growth and macroeconomic stability, limiting countries’ ability to achieve smooth recovery and reach the Sustainable Development Goals.",
    "Reducing gender gaps can have important economic benefits: gender equality can boost productivity, enhance economic resilience, and reduce income inequality.",
    "Phase 1 (March 2012 to March 2015)",
    "Phase 2 (April 2015 to March 2017)",
    "Phase 3 (April 2017 to March 2020)",
    "Phase 4 (April 2020 to March 2025)",
    "Development and application of analytic tools to assess distributional impacts:",
    "Production of thematic papers and SDNs linking macro-structural policies, fiscal policy, capital account liberalization, and gender to distributional outcomes.",
    "Delivery of conferences and training courses to foster research discussions and disseminate findings on macroeconomic policy, income inequality, and gender.",
    "Integrating distributional analysis into macroeconomic modeling is central to understanding the equity implications of fiscal, structural, and external policies in LICs.",
    "Gender-focused analysis and gender budgeting are important complements to distributional macroeconomic frameworks for promoting inclusive growth.",
    "Policy evaluation should consider both short-run and long-run welfare implications, particularly when assessing revenue mobilization via different tax instruments and post-COVID recovery strategies.",
    "**June 2019**",
    "**June 2020**",
    "**June 2021**",
    "**June 2022**",
    "**June 2023**",
    "**June 2024**",
    "**June 2025**",
    "**Call to Donors to Strengthen IMF Research Capacity for Low-Income Countries**",
    "**Macroeconomic Research in Low Income Countries — June 2013**",
    "**Macroeconomic Research in Low Income Countries — June 2014**",
    "**Macroeconomic Research in Low‑Income Countries — Third Year Annual Report to DFID**",
    "**Annual Review of the Macroeconomic Research in Low Income Countries project**",
    "**June2017**",
    "**MRLIC programme review — By March 2018**",
    "[List of Outputs: Year 1 to 13 (XLSX)](/-/media/files/topics/lics/macro-research-for-development/listofoutputs.xlsx){rel=\"external\" type=\"application/vnd.openxmlformats-officedocument.spreadsheetml.sheet\"}",
    "**Dec 2018, Vol.6**",
    "**Dec 2019, Vol.7**",
    "**Dec 2020, Vol.8**",
    "**Dec 2021, Vol.9**",
    "**Dec 2022, Vol.10**",
    "**Dec 2023, Vol.11**",
    "**Dec 2024, Vol.12**",
    "**Dec 2025, Vol.13**",
    "**Jun 2018, Vol.6**",
    "**Jun 2019, Vol.7**",
    "**Jun 2020, Vol.8**",
    "**Jun 2021, Vol.9**",
    "**Jun 2022, Vol.10**",
    "**Jun 2023, Vol.11**",
    "**Jun 2024, Vol.12**",
    "[Jun 2025, Vol.13 (PDF)](/-/media/files/topics/lics/macro-research-for-development/newsletters/jun2025.pdf){rel=\"external\" type=\"application/pdf\"}",
    "**Mar 2018, Vol.6**",
    "**Mar 2019, Vol.7**",
    "**Mar 2020, Vol.8**",
    "**Mar 2021, Vol.9**",
    "**Mar 2022, Vol.10**",
    "**Mar 2023, Vol.11**",
    "[Mar 2024, Vol.12 (PDF)](/-/media/files/topics/lics/macro-research-for-development/newsletters/mar2024.pdf){rel=\"external\" type=\"application/pdf\"}",
    "**Mar 2025, Vol.13**",
    "**Mar 2026, Vol.14**",
    "**Sep 2018, Vol.6**",
    "**Sep 2019, Vol.7**",
    "**Sep 2020, Vol.8**",
    "**Sep 2021, Vol.9**",
    "**Sep 2022, Vol.10**",
    "**Sep 2023, Vol.11**",
    "**Sep 2024, Vol.12**",
    "[Sep 2025, Vol.13 (PDF)](/-/media/files/topics/lics/macro-research-for-development/newsletters/sep2025.pdf){rel=\"external\" type=\"application/pdf\"}",
    "**Devarajan–O'Connell final report on the MRLIC project**"
  ],
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