The relationship, whether income inequality reduces economic growth, has been carefully examined by various economists over the years. Most of them conduct studies to find a negative correlation between inequality and overall growth. In this essay I will discuss the effects of inequality on economic growth and vice versa, if such effects occur. I will also explore how inequality is measured and why existing studies on this topic need to be inferred carefully as measures of inequality can be inconsistent. Inequality is measured in different ways using data on income (gross and net) or expenditure. The unit of measurement may also vary from individual to household, etc. [2] Because of this variation, we would expect to obtain different measures of inequality depending on which of the above modes is used. It is important to use consistently measured data in empirical studies. For example, the inequality of all countries would be measured using gross income. Empirical work should not consist of data based, for example, on the income of some countries a...