Support education or counteract crime? – growth determinants in the context of income inequality

Income inequality is one of the most common issues considered in the context of economic growth. As theoretical literature indicates, income inequality interacts with the level of development through various channels, e.g. education, investment level or delinquency. We used data from 120 developed and developing countries to verify empirically the existence and strength of these channels. The estimates cannot confirm the statistical or economic relevance of the channels proposed by the theory in linking inequalities and growth.