How Macroeconomic Factors Affect Income Distribution: The Cross-Country Evidence
November 1, 1997
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Summary
This study develops a cross-section empirical framework to examine the relationship between the macroeconomic environment and trends in income distribution. The macroeconomic variables that are found to be associated with an improvement in income distribution are higher growth rate, higher income level, higher investment rate, real depreciation (especially for low-income countries), and improvement in terms of trade. The estimated significant effects of growth, income, and investment provide evidence that policies designed to promote investment and growth are likely also to contribute to an improvement in income distribution.
Subject: Foreign exchange, Income distribution, Income inequality, Inflation, National accounts, Personal income, Prices, Real exchange rates
Keywords: after-tax wage income, chg Gini coefficient, Gini coefficient, growth rate, in-kind income, Inc net, income, income distribution, income distribution issue, income distribution variable, Income inequality, income level, Inflation, inflation stabilization program, interest income, macroeconomic factors, net, net effect, Ols regression, Personal income, rate of change, Real exchange rates, WP
Pages:
25
Volume:
1997
DOI:
Issue:
152
Series:
Working Paper No. 1997/152
Stock No:
WPIEA1521997
ISBN:
9781451922714
ISSN:
1018-5941
