Refitting the Kuznets curve
AbstractUsing Baltagi and Li (2002)’s semi-parametric fixed effects regression estimator, we investigate the existence of an aggregate ‘Kuznets curve’ in a sample of 113 countries over the 1960–2000 period. Our results show that misspecification of the functional form in a panel model with fixed effects, and the failure to control for the endogeneity of income per capita, can lead to dramatically different conclusions regarding the impact of economic development on inequality. While we find observational evidence of an inverted U relationship between inequality and economic development, this relationship does not seem to be causal. Once we account for endogeneity, inequality appears to decrease monotonically with income per capita.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Economics Letters.
Volume (Year): 116 (2012)
Issue (Month): 2 ()
Contact details of provider:
Web page: http://www.elsevier.com/locate/ecolet
Income distribution; Inequality; Kuznets curve; Nonparametric analysis; Panel estimator;
Find related papers by JEL classification:
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Zvi Griliches & Jerry A. Hausman, 1984.
"Errors in Variables in Panel Data,"
NBER Technical Working Papers
0037, National Bureau of Economic Research, Inc.
- Whitney K. Newey & James L. Powell & Francis Vella, 1998.
"Nonparametric Estimation of Triangular Simultaneous Equations Models,"
98-6, Massachusetts Institute of Technology (MIT), Department of Economics.
- Whitney K. Newey & James L. Powell & Francis Vella, 1999. "Nonparametric Estimation of Triangular Simultaneous Equations Models," Econometrica, Econometric Society, vol. 67(3), pages 565-604, May.
- Whitney Newey & James Powell & Francis Vella, 1998. "Nonparametric Estimation of Triangular Simultaneous Equations Models," Working papers 98-16, Massachusetts Institute of Technology (MIT), Department of Economics.
- Keith Head & Thierry Mayer & John Ries, 2011.
"The erosion of colonial trade linkages after independence,"
Sciences Po publications
info:hdl:2441/c8dmi8nm4pd, Sciences Po.
- Head, Keith & Mayer, Thierry & Ries, John, 2010. "The erosion of colonial trade linkages after independence," Journal of International Economics, Elsevier, vol. 81(1), pages 1-14, May.
- Thierry Mayer & Keith Head & John Ries, 2008. "The Erosion of Colonial Trade Linkages after Independence," Working Papers 2008-27, CEPII research center.
- Keith Head & John Ries & Thierry Mayer, 2008. "The erosion of colonial trade linkages after independence," Sciences Po publications 6951, Sciences Po.
- Head, Keith & Mayer, Thierry & Ries, John, 2008. "The Erosion of Colonial Trade Linkages After Independence," CEPR Discussion Papers 6951, C.E.P.R. Discussion Papers.
- Daron Acemoglu & Simon Johnson & James A. Robinson & Pierre Yared, 2008.
"Income and Democracy,"
American Economic Review,
American Economic Association, vol. 98(3), pages 808-42, June.
- Daron Acemoglu & Simon Johnson & James Robinson & Pierre Yared, 2005. "Income and Democracy," NBER Working Papers 11205, National Bureau of Economic Research, Inc.
- Acemoglu, Daron & Johnson, Simon & Robinson, James A & Yared, Pierre, 2005. "Income and Democracy," CEPR Discussion Papers 5273, C.E.P.R. Discussion Papers.
- Frederick Solt, 2009. "Standardizing the World Income Inequality Database," Social Science Quarterly, Southwestern Social Science Association, vol. 90(2), pages 231-242.
- Barro, Robert J, 2000. " Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
- Roger Newson, 2001. "B-splines and splines parameterized by their values at reference points on the x-axis," Stata Technical Bulletin, StataCorp LP, vol. 10(57).
- Badi H. Baltagi & Dong Li, .
"Series Estimation of Partially Linear Panel Data Models with Fixed Effects,"
0109, East Carolina University, Department of Economics.
- Badi H. Baltagi & Dong Li, 2002. "Series Estimation of Partially Linear Panel Data Models with Fixed Effects," Annals of Economics and Finance, Society for AEF, vol. 3(1), pages 103-116, May.
- David H. Romer & Jeffrey A. Frankel, 1999. "Does Trade Cause Growth?," American Economic Review, American Economic Association, vol. 89(3), pages 379-399, June.
- Cameron,A. Colin & Trivedi,Pravin K., 2005. "Microeconometrics," Cambridge Books, Cambridge University Press, number 9780521848053.
- Yatchew,Adonis, 2003.
"Semiparametric Regression for the Applied Econometrician,"
Cambridge University Press, number 9780521012263.
- Yatchew,Adonis, 2003. "Semiparametric Regression for the Applied Econometrician," Cambridge Books, Cambridge University Press, number 9780521812832.
- Ahamada, Ibrahim & Flachaire, Emmanuel, 2010. "Non-Parametric Econometrics," OUP Catalogue, Oxford University Press, number 9780199578009, September.
- Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-54, July.
- Christian Lessmann, 2011.
"Spatial Inequality and Development - Is there an Inverted-U Relationship?,"
CESifo Working Paper Series
3622, CESifo Group Munich.
- Lessmann, Christian, 2014. "Spatial inequality and development — Is there an inverted-U relationship?," Journal of Development Economics, Elsevier, vol. 106(C), pages 35-51.
- Alfano, Maria Rosaria & Baraldi, Anna Laura & Papagni, Erasmo, 2014. "Electoral Systems and Corruption: the Effect of the Proportionality Degree," MPRA Paper 53138, University Library of Munich, Germany, revised 11 Nov 2013.
- Zhu, Hui-Ming & You, Wan-Hai & Zeng, Zhao-fa, 2012. "Urbanization and CO2 emissions: A semi-parametric panel data analysis," Economics Letters, Elsevier, vol. 117(3), pages 848-850.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.