Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/190231 
Year of Publication: 
2018
Series/Report no.: 
ADBI Working Paper No. 810
Publisher: 
Asian Development Bank Institute (ADBI), Tokyo
Abstract: 
This study investigates empirically how human capital, measured by educational attainment, is related to income distribution. The regressions, using a panel data set covering a broad range of countries between 1980 and 2015, show that a more equal distribution of education contributes significantly to reducing income inequality. Educational expansion is a major factor in reducing educational inequality and thus income inequality. Public policies that improve social benefits and price stability contribute to reducing income inequality, while public spending on education helps to reduce educational inequality. In contrast, higher per capita income, greater openness to international trade, and faster technological progress tend to make both income and education distribution more unequal. Using the calibration of empirical results, we find that we can attribute the rising income inequality within East Asian economies in recent decades to the unequalizing effects of fast income growth and rapid progress in globalization and technological change, which have surpassed the income-equalizing effects from improved equality in the distribution of educational attainment during the period.
Subjects: 
income distribution
inequality
human capital
education
globalization
technological change
JEL: 
D31
H52
I24
O53
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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