Enhancing inclusion

February 2019

Despite strong growth over the past two decades, income inequality remains high in many low-income countries (LICs). The global crisis in 2008-2009 spurred a renewed focus on the distributional issues in macroeconomic analysis, and studies have shown that high levels of inequality can impair the sustainability of growth as well as macroeconomic stability, thereby also limiting countries’ ability to reach the Sustainable Development Goals. Also, the post-global crisis period has seen a greater recognition that reducing gender gaps can have important economic benefits. Gender equality can play a key role in boosting productivity, enhancing economic resilience, and reducing income inequality. What follows is a brief description of how the topic and the work on enhancing inclusion has evolved over the three phases of the DFID-IMF partnership on research on the macroeconomics of LICs.

  • Under phase 1 (March 2012 to March 2015), the research in phase 1 aimed to build distributional analysis into macroeconomic models and looking at the link between fiscal policy and income inequality. Some of the achievements under phase 1 include: a high-level conference on Fiscal Policy and Income Inequality in Sub-Saharan Africa. For a list of all the work produced under phase 1, see the reports for year 1, year 2, and year 3 of the DFID-IMF partnership.

For a list of products that have been produced under each of the three phases of the DFID-IMF partnership, see the box on outputs on the left-hand side.