Turn the Bull Loose: A Test of the Moderating Effect of Economic Liberalization on the Link Between Financialization and Income Inequality in Developed Economies*

2018 ◽  
Vol 100 (3) ◽  
pp. 808-824
Author(s):  
Roy Kwon
Keyword(s):  
Income Inequality ◽  
Economic Liberalization ◽  
Moderating Effect ◽  
Developed Economies

scholarly journals Exclusive Goods and Formal-Sector Employment

2011 ◽  
Vol 3 (1) ◽  
pp. 242-272 ◽  
Author(s):  
Reto Foellmi ◽  
Josef Zweimüller
Keyword(s):  
Income Inequality ◽  
Informal Economy ◽  
Aggregate Demand ◽  
Differentiated Products ◽  
Price Setting ◽  
Formal Sector ◽  
Developed Economies ◽  
Nonhomothetic Preferences ◽  
Unskilled Workers ◽  
The Rich

We explore how the underemployment problem of less-developed economies is related to income inequality. Consumers have nonhomothetic preferences over differentiated products of formal-sector goods and thus inequality affects the composition of aggregate demand via the price-setting behavior of firms. We find that high inequality divides the formal sector into mass producers and exclusive producers (which serve only the rich); high inequality generates an equilibrium where many workers are crowded into the informal economy; and an increase in subsistence productivity raises the unskilled workers' wages and boosts employment due to the higher purchasing power of poorer households. (JEL D31, D43, E24, E26, J24)

scholarly journals Growth Impacts of Income Inequality: Empirical Evidence From Nigeria

2019 ◽  
Vol 10 (3) ◽  
pp. 226
Author(s):  
Ademola Obafemi Young
Keyword(s):  
Income Inequality ◽  
Empirical Studies ◽  
Growth Time ◽  
African Countries ◽  
Developed Economies ◽  
Rights Protection ◽  
Property Rights Protection ◽  
Long Run ◽  
Theoretical Predictions ◽  
The Impact

The debate on whether income inequality promotes, restricts, or is independent of economic growth has been widely studied and discussed in development economics discourse. However, a careful reading of this extensive extant and burgeoning literature suggests that, other than the ambivalent nature and the fact that the bulk of these studies relied heavily on cross-section/-country/panel econometric analysis, empirical studies examining the nexus in the context of less developed economies, particularly, African countries, has received less attention, as most of the extant studies predominantly focused on developed economies. This current study, thus, attempts to examine the impact of inequality on growth in Nigeria spanning between the period 1970 and 2018. It also examined the theoretical predictions of some of the distinct transmission channels through which inequality impacts growth. Time series econometrics were applied. The results obtained consistently revealed that inequality hurts long-run growth in Nigeria. Also, the results obtained revealed that inequality in income increases relative redistribution and fertility, but lessens investment, gross enrollment ratio, and property rights protection in Nigeria, which may in turn impede growth.

On Health Expenditure and Income Inequality

2020 ◽  
pp. 117-151
Author(s):  
Orhan Torul
Keyword(s):  
Health Care ◽  
Income Inequality ◽  
Negative Correlation ◽  
Health Expenditure ◽  
Fixed Effects ◽  
Health Care Expenditure ◽  
Health Care Expenditures ◽  
Significant Negative Correlation ◽  
Developed Economies ◽  
Using Data

This study investigates the relationship between health care expenditure and income inequality empirically. Using data from a large panel of countries covering a sizeable period of time, how level and composition of health care expenditures correlate with income inequality is studied via the panel data fixed effects estimation methodology. These estimations yield several robust findings. First, there is a significant positive correlation between income inequality and reliance on private resources for health care financing. Second, there exists a significant negative correlation between health care expenditure per capita and income inequality. Third, there is a significant negative correlation between income inequality and health care expenditure as a share of GDP. Next, this study analyzes a select group of well-established democracies with developed economies to detect if health expenditure and income inequality variables correlate with public beliefs and preferences. Empirical analyses reveal that indeed belief and preferences accord well with policy choices.

Do welfare benefits compensate for globalization among affluent democracies?

2019 ◽  
Vol 30 (2) ◽  
pp. 158-175
Author(s):  
Yunmin Nam
Keyword(s):  
Income Inequality ◽  
Fixed Effects ◽  
Critical Role ◽  
Welfare States ◽  
Welfare Benefit ◽  
Developed Economies ◽  
Welfare Benefits ◽  
Income Inequalities ◽  
Welfare Systems ◽  
The Relationship

This article examines the nexus of globalization, welfare systems and income inequality, in which a key theme is the assessment of how the distributional consequences of globalization are altered by the welfare benefit programmes of advanced welfare states. Existing literature contends that globalization is one of the principle reasons for the current increases in income inequality in developed economies. However, the distributional effects of globalization can vary across disparate national contexts. The study investigates whether welfare systems successfully compensate those who are displaced by external competition while reducing the income inequalities caused by globalization. For the empirical analysis, both random- and fixed-effects models with cluster-robust standard errors are utilized, as are comprehensive measures of globalization, welfare policy and income inequality. The results from 16 affluent democracies between 1980 and 2010 show that some aspects of globalization were significantly related to increased income inequality; however, the relationship was also significantly moderated by generous welfare benefit programmes. These findings support the argument that welfare systems play a critical role in compensating for the rising income inequalities caused by globalization.

Expansion and Layering of Labour Regulation

Living Wage ◽  
2019 ◽  
pp. 73-97
Author(s):  
Shelley Marshall
Keyword(s):  
Economic Liberalization ◽  
Global Trade ◽  
Working Population ◽  
Migrant Group ◽  
Developed Economies ◽  
Employment Conditions ◽  
Apparel Production ◽  
Vulnerable Workers ◽  
Labelling System ◽  
Labour Regulation

Workers in developed economies have not been immune to the dynamics of global trade and economic liberalization that have stranded vulnerable workers in poorer countries. This chapter tracks the informalization of apparel production in Australia throughout the 1980s and 1990s, asking how national and international factors converged to leave a migrant group stranded, without the employment conditions and protections that Australia prided itself on providing to its working population. It then examines the subsequent attempts to re-formalize work by the creation of innovative legislation and ethical initiatives that add levers and regulatory agents. This study is important because Australia’s novel regulation combines market and non-market forms of regulation, with a successful ethical labelling system at the heart of the model.

GLOBAL TRENDS IN INCOME DISTRIBUTION: LONG-RUN INFLUENCES ON INCOME INEQUALITY

2019 ◽  
Vol 7 (7-12) ◽  
Author(s):  
THOMAS OBST
Keyword(s):  
Income Inequality ◽  
Income Distribution ◽  
National Income ◽  
Personal Income ◽  
Three Dimensions ◽  
Wage Dispersion ◽  
Comprehensive Overview ◽  
Global Trends ◽  
Developed Economies ◽  
Labour Share

This paper provides a comprehensive overview of the development in income distribution and outlines its major long-term trends of 23 countries worldwide. These countries are clustered in four groups covering the core advanced, the Nordic, the emerging, and the least developed economies of the world. This paper applies different measures to analyse income distribution in three dimensions: national income, functional income distribution, and personal income distribution. Depending on the indicators applied the time period ranges between 1960 and 2012. The empirical analysis shows that increases in national incomes are most pronounced in the advanced economies. The emerging economies also exhibit an upward trend in national income, but it has been less substantial. The least developed economies, however, have been detached from this trend and remain isolated. Moreover, this paper illustrates that there has been an enormous re-distribution of income. During the last three decades, the labour share of income has declined in nearly all countries under study. This development went hand in hand with increased personal income inequality. Disposable income inequality and market income inequality have both increased over the past 30 years. Wage dispersion also rose substantially contributing to greater income inequality. Additionally, the escalation of top income shares as well as the expansion of low paid employment has led to a growing gap between the top and the bottom income earners. This analysis also presents important interlinks between greater income inequality, the fall of the wage share, and increasing wage dispersion.

Income Inequality and Economic Growth: Heterogeneity and Nonlinearity

2019 ◽  
Vol 24 (3) ◽  
Author(s):  
Abebe Hailemariam ◽  
Ratbek Dzhumashev
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Measurement Errors ◽  
Developing Economies ◽  
Threshold Effect ◽  
Growth Effect ◽  
Developed Economies ◽  
Nonlinear Growth ◽  
Cross Country ◽  
The Relationship

AbstractThis paper examines the relationship between income inequality and economic growth in a broad panel of countries over the period from 1965 to 2014. We utilize an improved dataset for inequality with reduced measurement errors, which fosters cross-country comparability. In addition, we investigate whether accounting for heterogeneity across countries alters the estimated effect of inequality on growth, and whether the inequality-growth nexus varies with the level of income inequality. Our estimates show that after accounting for heterogeneity, the nonlinear growth effect of income inequality remains statistically and economically significant. We find a threshold effect of inequality on economic growth, and this threshold is higher for developing economies than for developed economies.

scholarly journals Income Inequality- Is it Global or Native Issue?

2020 ◽  
Vol 7 (02) ◽  
pp. 5802-5811
Author(s):  
Md. Nezum Uddin ◽  
Monir Ahmmed ◽  
Mohammad Burhan Uddin Khondker
Keyword(s):  
Income Inequality ◽  
National Income ◽  
Policy Choice ◽  
Total Income ◽  
Per Capita Gdp ◽  
Developed Economies ◽  
The Poor ◽  
Global Issue ◽  
Per Capita ◽  
Policy Discussion

Income inequality is a big issue that deserves much more coverage in the policy discussion. It is a global issue. Study found that income inequality is growing worldwide, with increasing per capita GDP. The lowest 40% of the world's population gains less than 25% of the total income. The growing national income is accrued to the wealthiest people around the globe. In many nations, the top 1% of people are receiving an increasing share of income. Not only the poor or developing countries, but also the developed economies are suffering from this disease. This paper noted that income inequality is a global problem, and nations should come out from this crisis; if not, the recent growth will be growth without equality. Since income inequality can be eliminated, and it is a matter of policy choice, policymakers should, therefore, take appropriate measures in this regard.

scholarly journals Air quality and life expectancy in the United States: An analysis of the moderating effect of income inequality

2019 ◽  
Vol 7 ◽  
pp. 100346 ◽  
Author(s):  
Terrence D. Hill ◽  
Andrew K. Jorgenson ◽  
Peter Ore ◽  
Kelly S. Balistreri ◽  
Brett Clark
Keyword(s):  
United States ◽  
Air Quality ◽  
Income Inequality ◽  
Life Expectancy ◽  
The United States ◽  
Moderating Effect
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