Structural Reforms as Antidotes against Social Inequalities

Abstract

Poland, like other countries worldwide, experiences substantial income inequalities and constantly expanding gaps in wealth. This causes adverse macroeconomic consequences by restricting dynamics of domestic demand. Levels of the inequalities are decided by tax, welfare and educational systems and, above all, by nature of a labour market. A desirable fiscal consensus becomes an urgent necessity. Although a degree of inequality is an immanent characteristic of capitalism, the question is, what levels of inequalities are acceptable and when do such inequalities become harmful rather than useful?