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Trade Liberalization and Income Inequality in India: A Poisson Distributed-Lag Analysis

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Listed:
  • Vertica AGARWAL
  • Jean H.P. PAELINCK
  • Kenneth A. REINERT

    ()

  • Roger R. STOUGH

Abstract

This paper addresses the relationship between trade liberalization and income inequality among Indian states using a Poisson distributed-lag analysis. Two measures of income inequality are considered: the Gini coefficient and the coefficient of variation. Trade liberalization is proxied using export growth. Results indicate that there is a different pattern of responses in inequality to export growth between rural and urban households. Rural inequality tends to be more responsive in the hoped-for direction than urban inequality.

Suggested Citation

  • Vertica AGARWAL & Jean H.P. PAELINCK & Kenneth A. REINERT & Roger R. STOUGH, 2008. "Trade Liberalization and Income Inequality in India: A Poisson Distributed-Lag Analysis," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 8(2), pages 187-192.
  • Handle: RePEc:eaa:aeinde:v:8:y:2008:i:2_15
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    References listed on IDEAS

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    1. Gaurav Datt & Martin Ravallion, 2002. "Is India's Economic Growth Leaving the Poor Behind?," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 89-108, Summer.
    2. Kenneth Reinert, 1998. "Rural non-farm development: a trade-theoretic view," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 7(4), pages 425-437.
    3. Prabhat Patnaik, 1997. "The context and consequences of economic liberalization in India," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 6(2), pages 165-178.
    4. Friedrich, Dieter, 1982. "A Dynamic Adjustment Equation for a Poisson Distributed Lag Model," Empirical Economics, Springer, vol. 7(3-4), pages 239-249.
    5. Frick, H, 1986. "A Note on a Dynamic Adjustment Equation for a Poisson Distributed Lag Model," Empirical Economics, Springer, vol. 11(1), pages 65-67.
    6. Mundle, S. & Tulasidhar, V.B., 1998. "Adjustment and Distribution: The Indian Experience," Papers 17, Asian Development Bank.
    7. Ravallion, Martin & Datt, Gaurav, 2002. "Why has economic growth been more pro-poor in some states of India than others?," Journal of Development Economics, Elsevier, vol. 68(2), pages 381-400, August.
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