The two charts below help illustrate the relationship between inequality and GDP growth (on the left), and redistribution and GDP growth (on the right). The authors note a “strong negative relationship” between inequality and growth – as inequality increases, growth numbers decline. Turning to the redistribution chart, the nearly-flat line indicates a weak (and if anything, positive) relationship between redistributive policies and GDP.
Anyone who runs a business would prefer to have 10,000 customers with $100,000 each than 1 with a $1,000,000,000.
What these studies do is formalize that notion, and illustrate the degree to which it helps growth to avoid the latter situation.