The Effects of Income Inequality and Redistribution in Democracies: A Dynamic Panel Data Approach

Authors

  • Goksu Aslan University of Messina

DOI:

https://doi.org/10.12775/DEM.2017.002

Keywords

democracy, economic growth, inequality, redistribution

Abstract

In this paper, the simultaneous effects of the inequality and redistribution on economic growth are tested for the whole sample and for a subset of democratic countries, following system-GMM estimation on a panel dataset over a period from 1960 to 2010. Overall, net inequality has a negative significant effect on subsequent 5 years for both samples, while redistribution impact is only significant in democracies. The findings are related to the fact that in democracies, the governments tend to significantly redistribute more.

Author Biography

Goksu Aslan, University of Messina

I have recently completed my PhD degree in Economics Methods at the University of Messina and the Advanced Studies Program in International Economic Policy Research at the Kiel Institute for the World Economy. The focus of my research area is testing income inequality and redistribution effects on economic growth and negative effects of income inequality on economic growth directly and indirectly through transmission channels which cover sociopolitical instability, political economy and credit market imperfection channels, as well as financial inclusion, inequality and gender gap in financial inclusion with a particular focus on Sub-Saharan Africa. I work in both microeconometrics and macroeconometrics methods.

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Dynamic Econometric Models

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Published

2017-10-02

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1.
ASLAN, Goksu. The Effects of Income Inequality and Redistribution in Democracies: A Dynamic Panel Data Approach. Dynamic Econometric Models. Online. 2 October 2017. Vol. 17, no. 1, pp. 19-39. [Accessed 6 July 2025]. DOI 10.12775/DEM.2017.002.

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Vol. 17 (2017)

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