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Economic Volatility and Inequality: Do Aid and Remittances Matter?

Listed author(s):
  • Lisa CHAUVET

    ()

    (IRD DIAL)

  • Marin FERRY

    (FERDI)

  • Patrick GUILLAUMONT

    ()

    (Ferdi)

  • Sylviane GUILLAUMONT JEANNENEY

    ()

    (Ferdi)

  • Sampawende J.-A. TAPSOBA

    (Fonds Monétaire international)

  • Laurent WAGNER

    ()

    (Ferdi)

We examine the adverse impact of macroeconomic volatility on inequality and the role that aid and remittances could play in mitigating this effect. Using a panel of 142 countries over 1973-2012, we find that macroeconomic volatility has an adverse impact on economic inequality and that the poorest are the most exposed to these fluctuations. However, while aid and remittances do not seem to have a clear direct impact on inequality, we find robust evidence that aid helps to dampen the negative effects of volatility on the distribution of income, while remittances do not.Keywords: Aid, Income volatility, Inequality

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File URL: http://www.ferdi.fr/sites/www.ferdi.fr/files/publication/fichiers/wp158_ferdi-_aid_income_volatility_and_inequality.pdf
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Paper provided by FERDI in its series Working Papers with number P158.

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Date of creation: Jul 2016
Handle: RePEc:fdi:wpaper:3082
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Web page: http://ferdi.fr/

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