The long-run relationship between finance and income inequality: Evidence from panel data

John Thornton; Caterina Di Tommaso

doi:10.1016/j.frl.2019.04.036

The long-run relationship between finance and income inequality: Evidence from panel data

John Thornton
, Caterina Di Tommaso

The Albert Gubay Business School

University of Bari Aldo Moro
Office of Technical Assistance, US Department of the Treasury

Research output: Contribution to journal › Article › peer-review

Abstract

We use heterogeneous panel cointegration techniques to examine the long-run effect of financial development on income inequality in a panel of 119 countries from 1980 to 2015. We include real GDP per capita in the cointegration relation and explicitly deal with cross-sectional de- pendence in the data that arises due to unobserved common factors. On average, financial de- velopment reduces income inequality in the long-run, with the result robust to different measures of finance and across country income groups.

Original language	English
Article number	101180
Journal	Finance Research Letters
Volume	32
Early online date	30 Apr 2019
DOIs	https://doi.org/10.1016/j.frl.2019.04.036
Publication status	Published - Jan 2020

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 10 Reduced Inequalities

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10.1016/j.frl.2019.04.036

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abstract = "We use heterogeneous panel cointegration techniques to examine the long-run effect of financial development on income inequality in a panel of 119 countries from 1980 to 2015. We include real GDP per capita in the cointegration relation and explicitly deal with cross-sectional de- pendence in the data that arises due to unobserved common factors. On average, financial de- velopment reduces income inequality in the long-run, with the result robust to different measures of finance and across country income groups.",

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The long-run relationship between finance and income inequality: Evidence from panel data

Abstract

UN SDGs

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