Growth Volatility and Inequality in the U.S.: A Wavelet Analysis
Rangan Gupta (),
Stephen Miller () and
Mark Wohar ()
Additional contact information
Shinhye Chang: University of Pretoria
No 2018-05, Working papers from University of Connecticut, Department of Economics
This study applies wavelet coherency analysis to explore the relationship between the U.S. economic growth volatility, and income and wealth inequality measures over the period 1917 to 2015 and 1962 to 2014. We consider the relationship between output volatility during positive and negative growth scenarios. Wavelet analysis simultaneously examines the correlation and causality between two series in both the time and frequency domains. Our findings provide evidence of positive correlation between the volatility and inequality across high (short-run)- and low-frequencies (long-run). The direction of causality varies across frequencies and time. Strong evidence exists that volatilities lead inequality at low-frequencies across income inequality measures from 1917 to 1997. After 1997, however, the direction of causality changes. In the time-domain, the time-varying nature of long-run causalities implies structural changes in the two series. These findings provide a more thorough picture of the relationship between the U.S. growth volatility and inequality measures over time and frequency domains, suggesting important implications for policy makers.
Keywords: Growth volatility; Income and Wealth Inequalities; Wavelet analysis (search for similar items in EconPapers)
JEL-codes: C49 O15 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-gro and nep-his
Note: Stephen Miller is the corresponding author
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
https://media.economics.uconn.edu/working/2018-05.pdf Full text (application/pdf)
Journal Article: Growth volatility and inequality in the U.S.: A wavelet analysis (2019)
Working Paper: Growth Volatility and Inequality in the U.S.: A Wavelet Analysis (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:uct:uconnp:2018-05
Access Statistics for this paper
More papers in Working papers from University of Connecticut, Department of Economics University of Connecticut 365 Fairfield Way, Unit 1063 Storrs, CT 06269-1063. Contact information at EDIRC.
Bibliographic data for series maintained by Mark McConnel ().