Determinants of Inclusive Growth in ASEAN

Victoriia Alekhina and Giovanni Ganelli

No 2020/118, IMF Working Papers from International Monetary Fund

Abstract: Over the past decades ASEAN countries have experienced rapid economic growth accompanied by a dramatic fall in poverty rates, but income inequality has not retreated. This research aims at identifying factors which could contribute to more equally distributed growth in ASEAN. To measure inclusive growth, we use a variable integrating per capita income growth and an equity index. A cross-country panel analysis of the impact of macro-structural factors on inclusive growth and its two components suggests that fiscal redistribution, female labor force participation, productivity growth, FDI inflows, digitalization, and savings significantly drive inclusive growth. A scenario analysis based on our econometric results suggests that the implementation of fiscal redistribution and labor market-oriented structural reforms could help significantly accelerate inclusive growth in ASEAN.

Keywords: WP; income; ASEAN country; per capita income; GDP; income share; income distribution; distribution data; economic growth; income inequality; Inclusive growth; Income inequality; Personal income; Income distribution; Fiscal redistribution; East Asia; Asia and Pacific; Inequality; Equity; inflation rate; simulation result (search for similar items in EconPapers)
Pages: 39
Date: 2020-07-03
New Economics Papers: this item is included in nep-sea
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