Interrelation among Economic Growth, Income Inequality, and Fiscal Performance: Evidence from Anglo-Saxon Countries
No 201403, AQR Working Papers from University of Barcelona, Regional Quantitative Analysis Group
The interrelation among economic growth, income inequality, and fiscal performance is very complex. The paper provides the analysis of the interrelations among these variables jointly by the structural VAR methodology, examining also transmission channels among them. This approach allows exploring dynamic interactions among them and feedback effects on each other. The empirical analysis is implemented for the Anglo-Saxon countries, the UK, the USA, and Canada. We find that income inequality has negative effect on economic growth in the case of the UK. The effect is positive in the cases of the USA and Canada. The increase in income inequality worsens fiscal performance for all the countries.
Keywords: economic growth; income inequality; fiscal performance; VAR JEL classification: C32; D31; E62; O47 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2014-02, Revised 2014-02
New Economics Papers: this item is included in nep-gro and nep-pbe
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Journal Article: Interrelation among Economic Growth, Income Inequality, and Fiscal Performance: Evidence from Anglo-Saxon Countries (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:aqr:wpaper:201403
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