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Macro-economic adjustment socio-demographic change, and the evolution of income distribution in Côte d'Ivoire. A decomposition by microsimulation

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  • Michael Grimm

    ()
    (University of Göttingen, Department of Economics, DIW and DIAL)

Abstract

This paper proposes a microeconomic decomposition of the evolution of income inequality in Cˆote d’Ivoire in the 1990s, allowing the in-depth analysis of simultaneous contributions of four types of phenomena to the evolution of the distribution of income: a change in the remuneration rates of observed and unobserved earnings determinants, a change in occupational preferences, and a change in the socio-demographic population structure. I show, for instance, that the increase in income inequality in Abidjan was the result of changes in the socio-demographic population structure and of changes in unobserved earnings determinants, even though higher activity, inflows in wage labour, a drop in returns to schooling, and the Ivorian/Non-Ivorian wage differential worked toward a more equal distribution. Concerning the link between growth and inequality, it is interesting to note that both negative income growth in Abidjan as well as positive income growth in rural Cˆote d’Ivoire, were connected with rising inequality. _________________________________ Cet article propose une d´ecomposition micro-économique de l’évolution de l’inégalité en Côte d’Ivoire dans les années 1990, en vue d’identifier les contributions simultanées de quatre types de phénomnes à la distribution du revenu : un changement des taux de rémunération des déterminants observés et nonobserv és du revenu, un changement du comportement de l’offre de travail et un changement de la structure socio-démographique de la population. Je montre, par exemple, que l’augmentation de l’inégalité du revenu Abidjan a été le résultat de changements dans la structure socio-démographique de la population et de variations des taux de rémunération des déterminants non-observés du revenu, et ce en dépit de taux d’activité et d’entrées dans le salariat plus forts, d’une baisse des rendements de l’éducation et du différentiel de salaire entre Ivoiriens et Non-Ivoiriens, qui ont joué à l’inverse en faveur de l’égalité des revenus. Concernant le lien entre croissance et inégalité, il est intéressant à noter que la croissance négative du revenu `a Abidjan comme la croissance positive dans le milieu rural ont été, tous les deux, accompagnées d’une hausse de l’inégalité.

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File URL: http://www.dial.ird.fr/media/ird-sites-d-unites-de-recherche/dial/documents/publications/doc_travail/2001/2001-12
File Function: First version, 2001
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Bibliographic Info

Paper provided by DIAL (Développement, Institutions et Mondialisation) in its series Working Papers with number DT/2001/12.

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Length: 51 pages
Date of creation: Aug 2001
Date of revision:
Handle: RePEc:dia:wpaper:dt200112

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Related research

Keywords: Decomposition; earnings differentials; income distribution; microsimulation; occupational choices; poverty.;

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  1. Blau, Francine D & Kahn, Lawrence M, 1996. "International Differences in Male Wage Inequality: Institutions versus Market Forces," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 791-836, August.
  2. 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 410-42, June.
  3. McFadden, Daniel L., 1984. "Econometric analysis of qualitative response models," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 24, pages 1395-1457 Elsevier.
  4. Wim P. M. Vijverberg, 1993. "Educational Investments and Returns for Women and Men in Côte d'Ivoire," Journal of Human Resources, University of Wisconsin Press, vol. 28(4), pages 933-974.
  5. Bourguignon, F. & Fournier, M. & Gurgand, M., 2000. "Fast Development with a Stable Income Distribution: Taiwan, 1979-1994," DELTA Working Papers 2000-07, DELTA (Ecole normale supérieure).
  6. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  7. Gourieroux Christian & Monfort Alain & Renault E & Trognon A, 1985. "Simulated residuals," CEPREMAP Working Papers (Couverture Orange) 8502, CEPREMAP.
  8. Steiner, Viktor & Wagner, Kersten, 1996. "Has earnings inequality in Germany changed in the 1980's?," ZEW Discussion Papers 96-32, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  9. Francois Bourguignon & Francisco H. G. Ferreira & Nora Lusting, 2005. "The Microeconomics of Income Distribution Dynamics in East Asia and Latin America," World Bank Publications, The World Bank, number 14844, January.
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