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Kuznets’S Hypothesis And The Data Constraint

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  • Argentino Pessoa

    (Faculdade de Economia da Universidade do Porto, Portugal)

Abstract

Five decades ago, Simon Kuznets expressed an important hypothesis about the relationship between the degree of income inequality within a country and its level of economic development: the Kuznets’s inverted-U hypothesis. The lack of longitudinal data has forced the use of cross-section or pooled datasets in order to draw conclusions about that relationship. In the present note we highlight the lack of international comparability of surveys where the measures of inequality are based, and we show two main findings: 1) data comparability goes on constituting a problem, particularly in what respects to the different welfare indicators used in national surveys, and 2) the procedure usually used to minimize the problem of noncomparability is likely to enforce the bias rather than to solve it.

Suggested Citation

  • Argentino Pessoa, 2008. "Kuznets’S Hypothesis And The Data Constraint," FEP Working Papers 267, Universidade do Porto, Faculdade de Economia do Porto.
    • Handle: RePEc:por:fepwps:267
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    References listed on IDEAS

    as
    1. A.B. Atkinson & F. Bourguignon (ed.), 2000. "Handbook of Income Distribution," Handbook of Income Distribution, Elsevier, edition 1, volume 1, number 1.
    2. World Bank, 2006. "World Development Indicators 2006," World Bank Publications - Books, The World Bank Group, number 8151, December.
    3. Angus Deaton & Salman Zaidi, 2002. "Guidelines for Constructing Consumption Aggregates for Welfare Analysis," World Bank Publications, The World Bank, number 14101, April.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Inequality; Kuznets’s hypothesis; economic development; income distribution;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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