How polarized is the global income distribution?

Roope, Laurence; Niño‐Zarazúa, Miguel; Tarp, Finn

doi:10.35188/unu-wider/2018/445-2

Cited by 4 publications

(4 citation statements)

References 18 publications

(23 reference statements)

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“…Data for income inequality are taken from the standardised income inequality dataset (WIID) of the World Institute for Development Economics Research (WIDER). This data-set has been used extensively in the literature (see Ackland et al 2013;Roope, Nino-Zarazua, & Tarp, 2018), and is widely regarded as the most reliable data on inequality for developing (and developed) countries. We use Net Ginis, which measure net per capita income inequality in a country in a given year.…”

Section: Patterns Of Structural Transformation and Inequalitymentioning

confidence: 99%

Was Kuznets Right? New Evidence on the Relationship between Structural Transformation and Inequality

Baymul

Sen

2020

The Journal of Development Studies

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We examine the Kuznets postulate that structural transformation leads to higher inequality using comparable panel data for a large number of developing and developed countries for 1960-2012. Countries are in different stages of structural transformation, being either structurally underdeveloped, structurally developing or structurally developed. In contrast to the Kuznets hypothesis, we find that the movement of workers to manufacturing unambiguously decreases income inequality, irrespective of the stage of structural transformation that a particular country is in. We also find that the movement of workers into services has a positive impact on inequality across our set of countries at an early stage of structural transformation and a negative effect at a later stage, suggesting that the Kuznets postulate may apply more for services-driven structural transformation than manufacturing-driven structural transformation. Overall, our findings confirm the positive development effects that structural transformation relating to manufacturing may have in developing countries, not merely through higher growth but by reducing inequality as well. However, for many low-income countries, where the realistic possibility of structural transformation may be the movement of workers from agriculture to services, our findings suggest that inequality may increase with further structural transformation.

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Section: Patterns Of Structural Transformation and Inequalitymentioning

confidence: 99%

Was Kuznets Right? New Evidence on the Relationship between Structural Transformation and Inequality

Baymul

Sen

2020

The Journal of Development Studies

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“…Another interesting aspect that could be studied by extending our experimental setting is the role of middle class in promoting a healthier functioning of the society, as long theorized in the political science literature. Controlled laboratory evidence on the role of income bipolarization on antisocial behavior could be important in light of the increase in absolute bipolarization observed in the last decades (Roope et al, 2018). In all models except Model 4, controls for individual characteristics include age and the number of mistakes made in the control questions, and a set of dummies for: male, political orientation (indicating self-reported right-wing political views), non-German subjects, field of study (social sciences, hard sciences, and humanities).…”

Section: Resultsmentioning

confidence: 99%

Economic Polarization and Antisocial Behavior: An Experiment

2019

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Economic inequality may fuel frustration, possibly leading to anger and antisocial behavior. We experimentally study a situation where only the rich can reduce inequality while the poor can express their discontent by destroying the wealth of a rich counterpart with whom they had no previous interaction. We test whether the emergence of such forms of antisocial behavior depends only on the level of inequality, or also on the conditions under which inequality occurs. We compare an environment in which the rich can unilaterally reduce inequality with one where generosity makes them vulnerable to exploitation by the poor. We find that the rich are expected to be more generous in the former scenario than in the latter, but in fact this hope is systematically violated. We also observe that the poor engage in forms of antisocial behavior more often when reducing inequality would be safe for the rich. These results cannot be rationalized by inequality aversion alone, while they are in line with recent models that focus on anger as the result of the frustration of expectations.

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Section: Discussionmentioning

confidence: 99%