ADDRESSING INCOME INEQUALITY: INTERNATIONAL EXPERIENCE AND PROSPECTS FOR THE AZERBAIJANI MODEL

Abstract

Income inequality remains a significant challenge to sustainable economic development and social justice worldwide. The unequal distribution of the benefits of economic growth among different segments of society contributes to rising social tensions, the deepening of poverty, and limitations to inclusive development. Persistent disparities in income and opportunities can weaken social cohesion and reduce the effectiveness of economic policies aimed at improving overall welfare. In this regard, the formulation and implementation of effective public policies aimed at reducing income inequality have become an important priority for governments and international organizations. This article analyzes successful international practices in addressing income inequality and examines the possibilities of adapting these approaches within the Azerbaijani context. The findings of the study indicate that in many countries progressive taxation policies, well-designed social transfer mechanisms, increased investment in education and healthcare, and inclusive labor market policies have proven effective in reducing inequality and improving social welfare. In recent years, Azerbaijan has also made notable progress in enhancing the welfare of low-income populations through the expansion of social protection mechanisms and the implementation of targeted social assistance programs.
Based on a comparative analysis of international experience, the article systematizes existing policy instruments aimed at reducing income inequality in Azerbaijan, considering the country’s institutional structure and fiscal capacities. The study also proposes a set of policy recommendations aimed at strengthening social protection systems, promoting inclusive growth, and improving the effectiveness of inequality-reduction strategies.