On Income Inequality and Population Size

Thitithep Sitthiyot and Kanyarat Holasut

MPRA Paper from University Library of Munich, Germany

Abstract: The pursuit of having an appropriate level of income inequality should be viewed as one of the biggest challenges facing academic scholars as well as policy makers. Unfortunately, research on this issue is currently lacking. This study is the first to introduce the theoretical concept of targeted level of income inequality for a given size of population. By employing the World Bank’s data on population size and Gini coefficient from sixty-nine countries in 2012, this study finds that the relationship between Gini coefficient and natural logarithm of population size is nonlinear in the form of a second degree polynomial function. The estimated results using regression analysis show that the majority of countries in the sample have Gini coefficients either too high or too low compared to their appropriate values. These findings could be used as a guideline for policy makers before designing and implementing public policies in order to achieve the targeted level of income inequality.

Keywords: Income Inequality; Gini Coefficient; Population Size (search for similar items in EconPapers)
JEL-codes: D31 D63 J19 (search for similar items in EconPapers)
Date: 2016-09-12
New Economics Papers: this item is included in nep-pbe and nep-sog
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://mpra.ub.uni-muenchen.de/75097/1/MPRA_paper_75097.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:73684

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