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Revisiting the Relationship between Income Inequality and Economic Growth

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  • Ricardo Argüello Cuervo

    (Universidad del Rosario)

Abstract

Most models that explore the relationship between income inequality and economic growth postulate the existence of a negative correlation between the two operating through diverse channels. parallel to the theoretical models, a number of empirical studies have attempted to appraise this relationship . A broad consensus had built validating the existence of such negative correlation until some panel data studies tended to show the opposite result. The review of ensuing debate as well as the empirical estimation undertook in this paper show that estimates may not be as robust believed. It is suggested that country case studies may be to explore this issue more appropriately.

Suggested Citation

  • Ricardo Argüello Cuervo, 2006. "Revisiting the Relationship between Income Inequality and Economic Growth," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 64, pages 37-58, Enero-Jun.
    • Handle: RePEc:lde:journl:y:2006:i:64:p:37-58
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    References listed on IDEAS

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    More about this item

    Keywords

    income distribution; Growth; Panel Data Econometrics; Multi regional;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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