IDEAS home Printed from https://ideas.repec.org/a/spr/qualqt/v48y2014i1p149-156.html
   My bibliography  Save this article

Human capital inequality and income inequality: testing for causality

Author

Listed:
  • Muhammad Chani

    ()

  • Sajjad Jan
  • Zahid Pervaiz
  • Amatul Chaudhary

Abstract

This study investigates the causal relationship between human capital inequality and income inequality in case of Pakistan. The annual time series data ranging from 1973 to 2009 is used for econometric analysis. Johanson co-integration and Granger Causality tests are used to confirm the existence of long run relationship and the causal relationship between human capital inequality and income inequality. The results indicate that there is positive relationship between the two types of inequalities in the long run. The estimates of causality test indicate that income inequality causes the human capital inequality but human capital inequality does not cause income inequality. Policy initiatives to reduce income inequality may empower people economically to avail skill building opportunities and accumulate their human capital through access to educational services. Copyright Springer Science+Business Media B.V. 2014

Suggested Citation

  • Muhammad Chani & Sajjad Jan & Zahid Pervaiz & Amatul Chaudhary, 2014. "Human capital inequality and income inequality: testing for causality," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(1), pages 149-156, January.
  • Handle: RePEc:spr:qualqt:v:48:y:2014:i:1:p:149-156
    DOI: 10.1007/s11135-012-9755-7
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11135-012-9755-7
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    2. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
    3. Yang, Dennis Tao, 2002. "What has caused regional inequality in China?," China Economic Review, Elsevier, vol. 13(4), pages 331-334, December.
    4. Chani, Muhammad Irfan & Pervaiz, Zahid & Jan, Sajjad Ahmad & Ali, Amjad & Chaudhary, Amatul R., 2011. "Poverty, inflation and economic growth: empirical evidence from Pakistan," MPRA Paper 34290, University Library of Munich, Germany, revised 2011.
    5. Zahid Pervaiz & Amatul R. Chaudhary, 2015. "Social Cohesion and Economic Growth: An Empirical Investigation," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 48(4), pages 369-381, December.
    6. Tewodaj Mogues & Michael Carter, 2005. "Social capital and the reproduction of economic inequality in polarized societies," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 3(3), pages 193-219, December.
    7. Haroon Jamal, 2006. "Does Inequality Matter for Poverty Reduction? Evidence from Pakistan’s Poverty Trends," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 45(3), pages 439-459.
    8. Oded Galor & Joseph Zeira, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Oxford University Press, vol. 60(1), pages 35-52.
    9. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    10. E. N. Appiah & W. W. McMahon, 2002. "The Social Outcomes of Education and Feedbacks on Growth in Africa," Journal of Development Studies, Taylor & Francis Journals, vol. 38(4), pages 27-68.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ghosh, sudeshna, 2017. "Education Attainment Forecasting and Economic Inequality United States," MPRA Paper 89712, University Library of Munich, Germany.
    2. Muhammad Qasim & Zahid Pervaiz & Amatul Razzaq Chaudhary, 0. "Do Poverty and Income Inequality Mediate the Association Between Agricultural Land Inequality and Human Development?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 0, pages 1-20.
    3. Aurora A. C. Teixeira & Ana Sofia Loureiro, 2019. "FDI, income inequality and poverty: a time series analysis of Portugal, 1973–2016," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 18(3), pages 203-249, October.
    4. Muhammad Qasim & Zahid Pervaiz & Amatul Razzaq Chaudhary, 2020. "Do Poverty and Income Inequality Mediate the Association Between Agricultural Land Inequality and Human Development?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 151(1), pages 115-134, August.
    5. Attari, Muhammad Qasim & Pervaiz, Dr. Zahid & Razzaq Chaudhary, Dr. Amatul, 2017. "Impact of Agricultural Land Inequality on Human Development in Punjab (Pakistan)," MPRA Paper 89070, University Library of Munich, Germany.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:qualqt:v:48:y:2014:i:1:p:149-156. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Springer Nature Abstracting and Indexing). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.