Economics at your fingertips  

On the effects of income volatility on income distribution: Asymmetric evidence from state level data in the U.S

Mohsen Bahmani-Oskooee () and Motavallizadeh-Ardakani, Amid

Research in Economics, 2018, vol. 72, issue 2, 224-239

Abstract: A previous study that tried to assess the impact of income volatility on income inequality in the U.S. used state level data and a balanced panel model to conclude that increased volatility worsens income distribution in the U.S., which implies that decreased volatility should reduce inequality. We use the same data set that is extended by nine years and revisit the issue using linear and nonlinear ARDL time-series models to show that the above conclusion does not hold in every state. While we discover short-run asymmetric effects of income volatility on a measure of inequality in most states, they translate to long-run asymmetric effects only in 16 states. Both increased volatility and decreased volatility are found to have unequalizing effects on income distribution in these states.

Keywords: Income distribution; Income volatility; Asymmetry; State level data; United State (search for similar items in EconPapers)
JEL-codes: O16 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Research in Economics is currently edited by Federico Etro

More articles in Research in Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2019-06-05
Handle: RePEc:eee:reecon:v:72:y:2018:i:2:p:224-239