Arbeitspapier
Estimation and Inference for Actual and Counterfactual Growth Incidence Curves
Different episodes of economic growth display widely varying distributional characteristics, both across countries and over time. Growth is sometimes accompanied by rising and sometimes by falling inequality. Applied economists have come to rely on the Growth Incidence Curve, which gives the quantile-specific rate of income growth over a certain period, to describe and analyze the incidence of economic growth. This paper discusses the identification conditions, and develops estimation and inference procedures for both actual and counterfactual growth incidence curves, based on general functions of the quantile potential outcome process over the space of quantiles. The paper establishes the limiting null distribution of the test statistics of interest for those general functions, and proposes resampling methods to implement inference in practice. The proposed methods are illustrated by a comparison of the growth processes in the United States and Brazil during 1995-2007. Although growth in the average real wage was disappointing in both countries, the distribution of that growth was markedly different. In the United States, wage growth was mediocre for the bottom 80 percent of the sample, but much more rapid for the top 20 percent. In Brazil, conversely, wage growth was rapid below the median, and negative at the top. As a result, inequality rose in the United States and fell markedly in Brazil.
- Language
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Englisch
- Bibliographic citation
-
Series: IZA Discussion Papers ; No. 10473
- Classification
-
Wirtschaft
Semiparametric and Nonparametric Methods: General
Single Equation Models; Single Variables: Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions
Personal Income, Wealth, and Their Distributions
Measurement and Analysis of Poverty
- Subject
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growth incidence curves
potential outcomes
inference
quantile process
- Event
-
Geistige Schöpfung
- (who)
-
Ferreira, Francisco H. G.
Firpo, Sergio
Galvao, Antonio F.
- Event
-
Veröffentlichung
- (who)
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Institute of Labor Economics (IZA)
- (where)
-
Bonn
- (when)
-
2017
- Handle
- Last update
-
20.09.2024, 8:21 AM CEST
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Ferreira, Francisco H. G.
- Firpo, Sergio
- Galvao, Antonio F.
- Institute of Labor Economics (IZA)
Time of origin
- 2017
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