ABSTRACT
This chapter looks at the economic growth and income distribution effects of fi scal policy instruments for raising resources. Very broadly, inclusive economic growth can be taken to encompass income growth in which no socioeconomic group is deprived of growth benefi ts. Economically weak groups can include the poor, the handicapped, the illiterate, children, indigenous peoples, and some women. Also included are unemployed workers and victims of war and natural disasters. Fiscal policy is inclusive if it deploys instruments promoting inclusion in addition to promoting its traditional goals of growth and macroeconomic stability. Here, non-income dimensions of inclusion are ignored, so inclusive economic growth is growth with static or falling poverty and inequality. Furthermore, this chapter looks only at instruments used to raise fi scal resources.
