The Relationship Between Development and Income Equality: An Empirical Analysis

D Alden, D-G Evans and J Sutiprapa

No 573, Department of Economics - Working Papers Series from The University of Melbourne

Abstract: Economic growth in Less Developed Countries (LDCs) over the last fifty years has often been accompanied by increasing income inequality. To explore this problem, we studied the relationship between income equality and development for forty LDCs using principal component analysis followed by multiple regression analysis. We found that income equality was strongly negatively correlated with the level of economic development. However, it was lower when economic growth was open to the world via export-orientation and exchange-rate stability, when the population growht rate was low, and when urban growth in regional areas was strong.

Keywords: INCOME DISTRIBUTION; DEVELOPING COUNTRIES (search for similar items in EconPapers)
JEL-codes: D31 O40 (search for similar items in EconPapers)
Pages: 28 pages
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:mlb:wpaper:573

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