Kuznets' inverted-U hypothesis
A)implies that things must get worse before they get better.
B)suggests that inequality will worsen and then improve as a country grows.
C)suggests that inequality will improve and then worsen as a country grows.
D) points out six characteristics of modern economic growth.

Question

Quizplus · Accepted Answer

Kuznets' inverted-U hypothesis suggests that inequality will initially worsen and then improve as a country experiences economic growth. This is based on the idea that in the early stages of development, inequality tends to increase as the benefits of growth are concentrated among a small elite. However, as the economy develops further, the benefits of growth are more widely shared and inequality begins to decline.

Kuznets' Inverted-U Hypothesis