Interrelation among Economic Growth, Income Inequality, and Fiscal Performance: Evidence from Anglo-Saxon Countries

Karen Davtyan

Hacienda Pública Española / Review of Public Economics, 2016, vol. 217, issue 2, 37-66

Abstract: The interrelation among economic growth, income inequality, and fiscal performance is very complex. The objective of this paper is to analyze the dynamic interrelations among these variables using struc¬tural VAR models and to examine transmission channels among them. The empirical analysis is imple¬mented for the UK, the USA, and Canada, using the longest possible consistently measured compa¬rable data on income inequality. The obtained results show that inequality has a negative effect on growth in the case of the UK while the effect is positive for the USA and Canada. An increase in in¬equality worsens fiscal performance for all the considered countries.

Keywords: economic growth; income inequality; fiscal performance; VAR. (search for similar items in EconPapers)
JEL-codes: C32 D31 E62 O47 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (5)

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Related works:
Working Paper: Interrelation among Economic Growth, Income Inequality, and Fiscal Performance: Evidence from Anglo-Saxon Countries (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hpe:journl:y:2016:v:217:i:2:p:37-66

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