Income Inequality in Small States and the Caribbean: Stylized Facts and Determinants
IMF Working Papers, February 12, 2021
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- Income Inequality in Small States and the Caribbean: Stylized Facts and Determinants
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Bibliographic details
- Authors: Arnold McIntyre, Takuji Komatsuzaki, Mauricio Vargas
- Published: February 12, 2021
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781513569475.001
Overview
- Rising income inequality is a major policy issue for policymakers, with limited empirical work focused on small states, including the Caribbean.
- Empirical analysis uses a sample of small states; analysis is constrained by data limitations.
Key Findings
- Increased openness and deeper economic integration, including financial market openness, is associated with lower income inequality.
- Elevated debt levels limit fiscal space and are associated with higher income inequality.
- Well targeted social sector spending aimed at improving education and health indicators supports increased redistribution and reduces income inequality.
Policy Implications and Recommendations
- Promote policies that increase openness and deepen economic and financial integration to help lower income inequality.
- Address elevated public debt to preserve fiscal space for redistributive policies.
- Prioritize well targeted social sector spending on education and health to enhance redistribution and reduce inequality.
Subjects and Keywords (as listed)
- Subjects: Foreign direct investment, Income, Income distribution, Income inequality, Public debt
- Keywords: absolute redistribution and income redistribution policies., Caribbean dummy variable, economic development, FDI inflow, Gini at market income, globalization, idiosyncratic income shock, market Gini coefficient, market income, redistribution policy, Small States, WP
Arnold McIntyre, Takuji Komatsuzaki, and Mauricio Vargas. "Income Inequality in Small States and the Caribbean: Stylized Facts and Determinants", IMF Working Papers 2021, 036 (2021), February 12, 2021, DOI: https://doi.org/10.5089/9781513569475.001
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