The aim of this study is to theoretically evaluate the effects of social protection expenditures on the economic development process through income inequality and poverty within the framework of Endogenous Growth Models and Thirlwall’s Law. The study does not seek to measure the empirical impacts of social protection policies; rather, it aims to discuss the relationship between these policies, economic growth, and external balance from a conceptual and theoretical perspective. In this context, the study addresses social protection policies within the scope of public finance and examines the relationship between redistribution and development in a holistic framework.

First, the study establishes a conceptual framework regarding development, social protection, income inequality, and poverty, and subsequently analyzes the interactions between these variables and economic growth. Empirical studies are systematically classified, and the roles of variables such as social expenditures, financial development, human capital, and trade openness on poverty and income distribution are evaluated in light of prominent findings in the literature.

The study emphasizes that fiscal policies are important not only as instruments of macroeconomic stability but also in terms of enhancing social welfare and improving income distribution. Accordingly, research on poverty and income distribution is addressed from a comprehensive perspective within the axis of public finance. Finally, the study proposes that the effects of social protection policies on development and growth should be further investigated by re-adapting them within the framework of growth models.