Abstract

This paper empirically examines the effect of income inequality on economic growth in a sample of 69 high income economies. It uses an improved inequality dataset developed by the World Institute for Development Economics Research and panel estimation techniques in an ordinary least squares regression. The results provide robust empirical evidence that rising levels of income inequality have adverse effects on growth in high income countries and indicate that, on average, a one standard deviation increase in income inequality will decrease growth by 67.91%. Results from the regression also suggest increases in human capital and international openness, decreases in the government consumption ratio, and more favorable terms of trade promote growth while higher initial per capita GDP and higher levels of investment retard growth.

Notes

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Thesis Completion

2012

Semester

Spring

Advisor

Pennington, Robert

Degree

Bachelor of Arts (B.A.)

College

College of Business Administration

Degree Program

Economics

Subjects

Business Administration -- Dissertations, Academic;Dissertations, Academic -- Business Administration

Format

PDF

Identifier

CFH0004166

Language

English

Access Status

Open Access

Length of Campus-only Access

None

Document Type

Honors in the Major Thesis

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Included in

Economics Commons

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