European Parliament Library

National Income and Its Distribution, Markus Bruckner, Era Dabla-Norris, Mark Gradstein

Does the distribution of income within a country become more equal as it grows richer? This paper uses plausibly exogenous variations in trade-weighted world income and international oil price shocks as instruments for within-country variations in countries real GDP per capita to examine this issue for a large sample of advanced and developing countries. Our findings indicate that increases in national income have a significant moderating effect on income inequality: a one percent increase in real GDP per capita, on average, reduces the Gini coefficient by around 0.08 percentage points, a result that is robust across income levels, different time horizons, and alternative estimation techniques. From a policy perspective, our results suggest that education policies that promote equity and help individuals continue on to higher levels of education could help reduce income inequality
Table Of Contents
Cover; Contents; I. Introduction; II. Literature Review; III. Data and Model; A. Data Description; B. Estimation Framework; IV. Empirical Results; A. Baseline Results; V. Robustness Checks; A. Alternative Model Specifications; B. Alternative Inequality and Poverty Data; VI. The Role of Economic Development; VII. Channels; VIII. Concluding Remarks; Figures; 1. GDP p.c. and Income Inequality (Cross-Country Scatter Plots, 1960-2010 Average); 2. GDP p.c. and Income Inequality (Cross-Country Scatter Plots, Year 2000); Tables; 1. Effects of National Income on National Income Inequality (Baseline)
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (45 p.)
Specific Material Designation
Form Of Item

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