Trade and Development Report, 2012

The Trade and Development Report (TDR) 2012 reviews recent trends in the global economy and explores the links between income distribution, growth and development. Global output growth is slowing down. In developed economies, high unemployment, ongoing deleveraging and downward pressures on real wages are causing lack of demand. An exit from recession in crisis-hit countries cannot be left to market forces alone; policies should aim to restore demand, instead of further depressing it with fiscal retrenchment.In this contribution to the on-going debate about the relationship between income inequality and growth, UNCTAD argues that rising inequality is neither a necessary condition for sound economic growth, nor its natural result. By contrast, full participation of all citizens in the proceeds of the economy as a whole in indispensable for successful and sustained development.