Impact of Innovation Activities on Employment and Inequality at Micro- and Macro Level

Economic inequality primarily refers to differences across individuals, social groups, and/or countries in terms of income distribution. Early studies in the wake of the First Industrial Revolution focused mainly on the functional distribution of income and the extent to which each production factor was relatively more or less rewarded. On the other hand, the current debate focuses primarily on inequality across individuals and/or countries, on the basis of the Kuznets’ approach that postulates an inverted U-shape relation between economic growth and income inequality. However, a growing secular trend of inequality between countries that started in the early nineteenth century was reversed in the last two decades while, as far as inequality within countries is concerned, highly differentiated paths took place in the wake of the Fourth Industrial Revolution.