The Inequality-Growth Plateau

Arbeitspapier

We examine the (potentially nonlinear) relationship between inequality and growth using a method which does not require an a priori assumption on the underlying functional form. This approach reveals a plateau completely missed by commonly used (nonlinear) parametric approaches - the economy first expands rapidly with a large decline in inequality, plateaus when inequality remains relatively stable, and then decreases rapidly with a large increase in inequality. This novel finding helps reconcile the conflicting results in the literature (using different parametric assumptions and datasets) and has important policy implications.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 8771

Classification and Topics

• Classification: Wirtschaft ; Semiparametric and Nonparametric Methods: General
• Subject: panel data ; growth ; inequality ; semiparametric

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Henderson, Daniel J. ; Qian, Junhui ; Wang, Le
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2015

Further information

• Handle: http://hdl.handle.net/10419/107563
• Last update: 10.03.2025, 11:45 AM CET