Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/68080
Authors: 
Angeles-Castro, Gerardo
Year of Publication: 
2006
Series/Report no.: 
Department of Economics Discussion Paper, University of Kent 06,01
Abstract: 
Using a panel data set of selected countries, this paper shows that the inequality-growth relationship follows an ordinary-U curve during the period 1970-98, in which inequality first decreases and then increases with economic growth. In addition, there is some evidence that the increasing pattern may reverse at higher levels of income. A time-series approach shows that a substantial group of countries capture a minimum turning point in different years along the period and others follow a permanent positive trend. It also indicates that only a few countries reverse inequality in a latter stage and display a maximum turning point after the mid 1990s; these countries are associated with macroeconomic stability, high governance and moderate expansion of trade and FDI. Hence, the inequality-growth relationship during the era of market openness has tended to change towards a positive one, although it might reverse at a later stage.
Subjects: 
Income Distribution
Economic Growth
Dynamic Panel Data Models
Time-Series Analysis
JEL: 
C22
C23
O15
O57
Document Type: 
Working Paper

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