The Nexus between Capital Flight and Income Inequality in Developing Countries

Francois Xavier Ngah Obama, Hans Tino Mpenya Ayamena and Francis Menjo Baye
Additional contact information
Francois Xavier Ngah Obama: University of Yaoundé II, Yaounde, Cameroon
Hans Tino Mpenya Ayamena: University of Douala, Douala, Cameroon
Francis Menjo Baye: University of Yaoundé II, Yaounde, Cameroon

Journal of Economic Development, 2026, vol. 51, issue 2, 69-88

Abstract: This study examines the relationship between capital flight and income inequality in 49 developing countries from 2000 to 2014. The study applies the bias-corrected method of moments and the method of moments quantile regression. We find that capital flight associates positively and significantly with income inequality. These results are heterogeneous across the conditional quantile distribution of income inequality. The quantile-specific results show that the income inequality increasing effect of capital flight is limited between the 10th and the 40th percentiles. These findings suggest that policy actions that mitigate capital flight would be effective in reducing income inequality, as well as other forms of inequality.

Keywords: Capital Flight; Income Inequality; Developing Countries (search for similar items in EconPapers)
JEL-codes: D63 F10 F21 G11 (search for similar items in EconPapers)
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://jed.cau.ac.kr/archives/51-2/51-2-4.pdf full text
None

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: https://EconPapers.repec.org/RePEc:ris:jecdev:023038

DOI: 10.35866/caujed.2026.51.2.004

Access Statistics for this article

Journal of Economic Development is currently edited by Sung Y. Park

More articles in Journal of Economic Development from The Economic Research Institute, Chung-Ang University Room 1137, Building 310, Chung-Ang University, 84 Heukseok-ro, Dongjak-gu, Seoul 06974, South Korea. Contact information at EDIRC.
Bibliographic data for series maintained by Jo A Jeong ().