When there is a major shift in the way a market functions or industry functions, it is known as structural change. As per Kuznets view, during the initial stages of structural transformation, inequality will increase. The inequality will start reducing after a certain level of structural transformation. Hence the Kuznets curve is inverted. You can read about the Kuznets Curve – Explanation of the Kuznets curve, its Criticisms in the given link.
Further readings:
- Inflation in Economy- Types of Inflation, Inflation Remedies [UPSC Notes]
- Indian Economy Notes For UPSC Exam [Download PDFs]
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