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Education, Economic Growth and Measured Income Inequality

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  • Rehme, Günther

Abstract

In this paper education simultaneously affects growth and income inequality. More education does not necessarily decrease inequality when the latter is assessed by the Lorenz dominance criterion. Increases in education first increase and then decrease growth as well as income inequality, when measured by the Gini coefficient. There is no clear functional relationship between growth and measured income inequality. The model identifies regimes of this relationship which depend crucially on the production and schooling technology. Conventional growth regressions with human capital and inequality as regressors may miss the richness of the underlying nonlinearities, but viewed as approximations may still provide important information on the nonlinear relationship between growth and education.
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  • Rehme, Günther, 2007. "Education, Economic Growth and Measured Income Inequality," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 43461, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
  • Handle: RePEc:dar:wpaper:43461
    Note: for complete metadata visit http://tubiblio.ulb.tu-darmstadt.de/43461/
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    9. Cipriani, Giam Pietro & Fioroni, Tamara, 2023. "Human Capital and Pensions with Endogenous Fertility and Retirement," IZA Discussion Papers 16029, Institute of Labor Economics (IZA).
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    17. IBOURK, Aomar & AMAGHOUSS, Jabrane, 2015. "Inequality In Education In The Mena Region: A Macroeconometric Investigation Using Normative Indicators," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 15(2), pages 129-146.
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    19. Janka Beresecká & Martin Hronec & Štefan Hronec & Jana Hroncová-Vicianová, 2022. "The impact of top management education on the socially responsible management of local government in the context of investment development," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 10(2), pages 608-622, December.
    20. Song, Yuegang & Paramati, Sudharshan Reddy & Ummalla, Mallesh & Zakari, Abdulrasheed & Kummitha, Harshavardhan Reddy, 2021. "The effect of remittances and FDI inflows on income distribution in developing economies," Economic Analysis and Policy, Elsevier, vol. 72(C), pages 255-267.
    21. David Mayston & Juan Yang, 2012. "Education, Risk and Efficiency in Human Capital Investment," Discussion Papers 12/15, Department of Economics, University of York.
    22. Paweł Kumor, 2010. "Zależność nierówności plac od poziomu rozwoju gospodarczego," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 7-8, pages 45-62.
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    More about this item

    JEL classification:

    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • I2 - Health, Education, and Welfare - - Education
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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