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Effect of Macroeconomic, Demographic, and Governance Factors on Income Inequality of Selected sub-Saharan Africa Countries

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  • Dagim Tadesse Bekele

    (Salale University, Department of Economics, Fiche, Ethiopi)

Abstract

This research tried to look effect of macroeconomic, demographic, and governance factors on income inequality in 34 sub-Saharan Africa countries by using unbalanced panel data spanning from 2010 to 2017. Two-step System GMM estimation is used for the econometrics analysis of the Dynamic Panel Data model. The finding revealed income inequality has a dynamic nature. Also, Kuznets’ hypothesis is worked in these countries: where economic growth is found to have a significant increasing effect on income inequality in short-run while in the long run, its’ effect is significant and decreasing. Population growth is the other variable that is found to have an increasing impact on income inequality. Differently, FDI and low perception of corruption decrease income inequality. Therefore, much focus will have to be given to achieve sustainable development objectives, promoting FDI, and controlling corruption. Also, managing the population growth is important.

Suggested Citation

  • Dagim Tadesse Bekele, 2020. "Effect of Macroeconomic, Demographic, and Governance Factors on Income Inequality of Selected sub-Saharan Africa Countries," Journal of Economic Development, Environment and People, Alliance of Central-Eastern European Universities, vol. 9(1), pages 60-70, September.
    • Handle: RePEc:sph:rjedep:v:9:y:2020:i:1:p:60-70
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    References listed on IDEAS

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    Cited by:

    1. Obadiah Jonathan Gimba & Mehdi Seraj & Huseyin Ozdeser, 2021. "What drives income inequality in sub‐Saharan Africa and its sub‐regions? An examination of long‐run and short‐run effects," African Development Review, African Development Bank, vol. 33(4), pages 729-741, December.

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    More about this item

    Keywords

    Effect; Income Inequality; Two-step system GMM; Sub-Saharan Africa.;
    All these keywords.

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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