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Inequality in Developing Economies: The Role of Institutional Development

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  • Adalgiso Amendola

    (Università di Salerno)

  • Joshy Easaw

    (University of Swansea)

  • Antonio Savoia

    (Department of Economics, University of Exeter)

Abstract

This paper studies the distributive impact of institutional change in developing countries. In such economies, property rights systems may preserve the interests of an influential minority, who can control key-markets, access to assets and investment opportunities, especially if they enjoy disproportionate political power. We test this hypothesis using cross-section and panel data methods on a sample of low- and middle-income economies from Africa, Asia and Latin America. Results suggest that: (a) increasing property rights protection increases income inequality; (b) this effect is larger in low-democracy environments; (c) few countries have developed political institutions capable of counterbalancing this effect.

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File URL: http://people.exeter.ac.uk/cc371/RePEc/dpapers/DP1107.pdf
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Bibliographic Info

Paper provided by Exeter University, Department of Economics in its series Discussion Papers with number 1107.

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Date of creation: 2011
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Handle: RePEc:exe:wpaper:1107

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Keywords: Inequality; developing economies; institutions; property rights; democracy.;

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References

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  9. AMENDOLA, Adalgiso & EASAW, Joshy & SAVOIA, Antonio, 2010. "Inequality in Developing Economies: The Role of Institutional Development," CELPE Discussion Papers 116, CELPE - Centre of Labour Economics and Economic Policy, University of Salerno, Italy.
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Cited by:
  1. José María, Larrú, 2012. "La relación entre la ayuda al desarrollo y la desigualdad. Evidencia y justificación teórica
    [Aid and inequality relationship. Evidence and theoretical justification]
    ," MPRA Paper 38857, University Library of Munich, Germany.
  2. Adalgiso Amendola & Joshy Easaw & Antonio Savoia, 2013. "Inequality in developing economies: the role of institutional development," Public Choice, Springer, vol. 155(1), pages 43-60, April.

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