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Government regulation and income inequality in the United States, 1970-1990

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  • Christopher Westley

Abstract

While many studies of income inequality in the United States focus of the significance of declining marginal tax rates in the 1980s, very little research to date has considered the effect of government regulations which have increased dramatically during the time of marked increases in the Gini coefficient. This paper presents a simple Ordinary Least Squares regression suggesting a relationship between government regulation and income inequality. It is suggested that increases in the regulatory burden in the US labour market increases the cost of low skilled labour relative to high skilled labour, contributing to increases in income inequality.

Suggested Citation

  • Christopher Westley, 1998. "Government regulation and income inequality in the United States, 1970-1990," Applied Economics Letters, Taylor & Francis Journals, vol. 5(12), pages 805-808.
    • Handle: RePEc:taf:apeclt:v:5:y:1998:i:12:p:805-808
    DOI: 10.1080/135048598354087
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    References listed on IDEAS

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    1. Lambert, Peter J, 1993. "Inequality Reduction through the Income Tax," Economica, London School of Economics and Political Science, vol. 60(239), pages 357-365, August.
    2. Deaton, Angus & Paxson, Christina, 1994. "Intertemporal Choice and Inequality," Journal of Political Economy, University of Chicago Press, vol. 102(3), pages 437-467, June.
    3. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-442, June.
    4. Richard B. Freeman, 1982. "Union Wage Practices and Wage Dispersion within Establishments," ILR Review, Cornell University, ILR School, vol. 36(1), pages 3-21, October.
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    Cited by:

    1. Adams, Samuel & Atsu, Francis, 2015. "Assessing the distributional effects of regulation in developing countries," Journal of Policy Modeling, Elsevier, vol. 37(5), pages 713-725.

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