Is Income Inequality Endogenous in Regional Growth?
AbstractThis study focuses on testing the relationship between income inequality and growth within U.S. counties, and the channels through which such effects are observed. Based on a system of equations estimation, the empirical results confirm the hypotheses that income inequality has a growth dampening effect; income inequality is endogenous to regional growth and growth adjustment; and the channels through which income inequality determines growth are regional growth adjustments, such as migration and regional adjustment in job and income growth. Results have numerous policy implications to the extent that: (1) that income inequality is endogenous, its equilibrium level can be internally determined within a regional growth process; (2) traditional income inequality mitigating policies have indirect effect on overall regional growth, they may have unintended indirect effects on income inequality; and (3) regional growth adjustment also equilibrates income inequality, such forces can be utilized as policy instruments to mitigate income inequality, and its growth dampening effects hence forth.
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Bibliographic InfoPaper provided by Regional Research Institute, West Virginia University in its series Working Papers with number 200901.
Length: 20 pages
Date of creation: 2009
Date of revision:
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Web page: http://rri.wvu.edu/research/working-papers/
More information through EDIRC
income inequality; growth; regional economics;
Other versions of this item:
- Yohannes G. Hailu & Mulugeta S. Kahsai & Tesfa G. Gebremedhin & Randall W. Jackson, 2011. "Is Income Inequality Endogenous In Regional Growth?," Journal of Income Distribution, Journal of Income Distribution, vol. 20(3-4), pages 43-56, September.
- Hailu, Yohannes G. & Kahsai, Mulugeta S. & Gebremedhin, Tesfa G. & Jackson, Randall W., 2009. "Is Income Inequality Endogenous in Regional Growth?," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 46320, Southern Agricultural Economics Association.
- E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
- R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy
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