Kuznets curve

The Kuznets curve describes a pattern observed in economic development: as a country develops, income inequality tends to rise initially, reaching a peak, and then gradually decreases. This creates an inverted U-shaped graph when plotting inequality against income levels. Early growth often benefits the wealthy more, increasing inequality. Over time, as wealth spreads through education, technology, and policies, inequality starts to decline. The curve suggests that economic growth can initially lead to more inequality, but with continued development, a more balanced income distribution may emerge.