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Long-run effects of democracy on income inequality: evidence from repeated cross-sections

Carlos Balcazar

No 7153, Policy Research Working Paper Series from The World Bank

Abstract: This paper assesses the link between democracy and inequality. Inequality is measured at the cohort level with pseudo-panel data built from nine Latin American countries'household surveys (1995-2009, biannual). Democracy is measured as a stock during long periods of time both before and after each cohort's year of birth. The paper presents evidence that long-run historical patterns in the degree of democracy relate to income inequality. However, this relationship is non-monotonic: inequality ?rst increases with the stock of democracy before falling. The paper also presents evidence that education may be a mechanism explaining this result.

Keywords: Parliamentary Government; Population Policies; Labor Policies; Inequality; Political Economy (search for similar items in EconPapers)
Date: 2015-01-01
New Economics Papers: this item is included in nep-gro, nep-lam and nep-pol
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