Inequality in Developing Economies: The Role of Institutional Development
AbstractThis paper studies the distributive impact of institutional change in developing countries. In such economies, economic institutions, such as property rights systems, may act to preserve the interests of an influential minority, but this depends crucially on the level of political equality. For example, dominant classes 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 the protection of property rights increases income inequality; (b) such an effect is larger in low-democracy environments; (c) a minority of countries have developed a set political institutions capable of counterbalancing this effect.
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Bibliographic InfoPaper provided by CELPE (Centre of Labour Economics and Economic Policy), University of Salerno, Italy in its series CELPE Discussion Papers with number 116.
Length: 51 pages
Date of creation: 2010
Date of revision:
inequality; developing economies; institutions; property rights; democracy;
Other versions of this item:
- 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.
- Adalgiso Amendola & Joshy Easaw & Antonio Savoia, 2011. "Inequality in Developing Economies: The Role of Institutional Development," Discussion Papers 1107, Exeter University, Department of Economics.
- D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
- O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-30 (All new papers)
- NEP-DEV-2011-01-30 (Development)
- NEP-PKE-2011-01-30 (Post Keynesian Economics)
- NEP-POL-2011-01-30 (Positive Political Economics)
- NEP-SEA-2011-01-30 (South East Asia)
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- 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.
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