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The impact of liberalisation policies on income inequality in african countries

  • Enowbi Batuo, Michael
  • Asongu, Simplice A.

Despite over three decades of Liberalisation policies in Africa, income-inequality has stayed persistently high. Using updated panel data of 26 African countries spanning the period 1996-2010, this study examines the effect of liberalisation policies with particular focus on financial, trade, institutional, political and economic liberalisations on income-inequality. We find: that financial liberalisation has a levitated income-redistributive effect with the magnitude of the de jure measure (KAOPEN) higher than that of the de facto measure (FDI); that exports, trade and ‘freedom to trade’ have an equality incidence on income-distribution; and that institutional and political liberalisation has a negative impact and we also find that, economic freedom has a negative income-redistributive effect possibly because of the weight of its legal component. The impact of these policies implications are discussed in detail in this study.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 43344.

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Date of creation: Jun 2012
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Handle: RePEc:pra:mprapa:43344
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