THE PAKISTAN DEVELOPMENT REVIEW
Achieving the Shared Economic Growth
After critically reviewing the literature on the institutional approaches for the shared growth, this paper briefly presents a General Theory of Economic Development (GTED) as basis for the discussion of shared growth. The GTED argues that Economic Discrimination (ED) by Markets, Corporations and Government is a necessary condition for shared economic development while Egalitarianism by any of them is a sufficient condition for economic stagnation. ED means treating the different differently while Egalitarianism is antithesis to ED. This paper also presents a new empirical framework for analysing growth and productivity implied by the GTED, and provides the empirical results that a 1 percent increase of per capita corporate asset brings about a 0.4 percent increase in per capita income and a decrease of income GIN1 coefficient by 0.015, supporting “the corporate-led shared growth hypothesis” of the GTED. Finally, the paper discusses the dramatic experiences of the rise. and fall of Korea’s economic development and the stagnated Pakistani experience over the last 60 years, implying that the growth stagnation has been due to the anti-corporate policy led by the egalitarianism.