Income growth in nonmetro America, 1968-75 /

Cover title.

Family income growth and income equality : progress or punishment?/

"This study was prepared by JEC/GOP staff : Christopher Frenze (author)...--p.13 nt.

Pro-poor growth or poverty trap? : estimating intergenerational income mobility in rural Philippines

Using an intergenerational database covering nearly a quarter of a century, we explored the degree of intergenerational income mobility among individuals who had grown up in rural Central Luzon, the Philippines. We found that the intergenerational income elasticity is significantly lower than unity, at roughly 0.23, indicating that the average income growth rate is higher for children born to poorer families. The detailed analysis, however, revealed that its magnitude significantly varies across percentiles in a U-shape. The results provide supporting evidence of multiple equilibria or poverty trap.

The role of human capital in economic growth revisited

Benhabib and Spiegel (1994) examine the role of human capital in the development process empirically using a theory-driven specification rather than the standard production function approach. While they find evidence of a positive impact of human capital on income growth, their result is not robust to the inclusion of inequality as an additional covariate. Using an alternate dataset and different measures of inequality, we find robust support for the hypothesis that human capital matters even when we account for the adverse effect of income inequality on growth.

Growth, migration and unemployment across Swedish municipalities

Fundamental questions in economics are why some regions are richer than others, why their economic growth rates vary, whether their growth tends to converge and the key factors that contribute to the variations. These questions have not yet been fully addressed, but changes in the local tax base are clearly influenced by the average income growth rate, net migration rate, and changes in unemployment rates. Thus, the main aim of this paper is to explore in depth the interactive effects of these factors (and local policy variables) in Swedish municipalities, by estimating a proposed three-equation system. Our main finding is that increases in local public expenditures and income taxes have negative effects on subsequent local income growth. In addition, our results support the conditional convergence hypothesis, i.e. that average income tends to grow more rapidly in relatively poor local jurisdictions than in initially “richer” jurisdictions, conditional on the other explanatory variables.

Growth and Inequality : A study of Swedish municipalities

This paper explores the relationship between the growth rate of the average income and income inequality using data at the municipal level in Sweden for the period 1992-2007. We estimate a fixed effects panel data growth model where the within-municipality income inequality is one of the explanatory variables. Different inequality measures (Gini coefficient, top income shares, and measures of inequality in the lower and upper ends of the income distribution) are also examined. We find a positive and significant relationship between income growth and income inequality, measured as the Gini coefficient and top income shares, respectively. In addition, while inequality at the upper end of the income distribution is positively associated with the income growth rate, inequality at the lower end of the income distribution seems to be negatively related to the growth rate. Our findings also suggest that increased income inequality enhances growth more in municipalities with a high level of average income than in those with a low level of average income.

Essays on growth and environment

This thesis consists of a summary and four self-contained papers. Paper [I] Following the 1987 report by The World Commission on Environment and Development, the genuine saving has come to play a key role in the context of sustainable development, and the World Bank regularly publishes numbers for genuine saving on a national basis. However, these numbers are typically calculated as if the tax system is non-distortionary. This paper presents an analogue to genuine saving in a second best economy, where the government raises revenue by means of distortionary taxation. We show how the social cost of public debt, which depends on the marginal excess burden, ought to be reflected in the genuine saving. We also illustrate by presenting calculations for Greece, Japan, Portugal, U.K., U.S. and OECD average, showing that the numbers published by the World Bank are likely to be biased and may even give incorrect information as to whether the economy is locally sustainable. Paper [II] This paper examines the relationships among per capita CO2 emissions, per capita GDP and international trade based on panel data spanning the period 1960-2008 for 150 countries. A distinction is also made between OECD and Non-OECD countries to capture the differences of this relationship between developed and developing economies. We apply panel unit root and cointegration tests, and estimate a panel error correction model. The results from the error correction model suggest that there are long-term relationships between the variables for the whole sample and for Non-OECD countries. Finally, Granger causality tests show that there is bi-directional short-term causality between per capita GDP and international trade for the whole sample and between per capita GDP and CO2 emissions for OECD countries. Paper [III] Fundamental questions in economics are why some regions are richer than others, why their growth rates differ, whether their growth rates tend to converge, and what key factors contribute to explain economic growth. This paper deals with the average income growth, net migration, and changes in unemployment rates at the municipal level in Sweden. The aim is to explore in depth the effects of possible underlying determinants with a particular focus on local policy variables. The analysis is based on a three-equation model. Our results show, among other things, that increases in the local public expenditure and income taxe rate have negative effects on subsequent income income growth. In addition, the results show conditional convergence, i.e. that the average income among the municipal residents tends to grow more rapidly in relatively poor local jurisdictions than in initially “richer” jurisdictions, conditional on the other explanatory variables. Paper [IV] This paper explores the relationship between income growth and income inequality using data at the municipal level in Sweden for the period 1992-2007. We estimate a fixed effects panel data growth model, where the within-municipality income inequality is one of the explanatory variables. Different inequality measures (Gini coefficient, top income shares, and measures of inequality in the lower and upper part of the income distribution) are examined. We find a positive and significant relationship between income growth and income inequality measured as the Gini coefficient and top income shares, respectively. In addition, while inequality in the upper part of the income distribution is positively associated with the income growth rate, inequality in the lower part of the income distribution seems to be negatively related to the income growth. Our findings also suggest that increased income inequality enhances growth more in municipalities with a high level of average income than in municipalities with a low level of average income.

Voices of the Poor: Poverty and Growth in Albania

This paper uses three waves of panel surveys at the household level to study growth and poverty in Albania over the period 2002-2004. It attempts to answer two main questions. The first question is directed at finding the micro determinants of growth and aims to expose the obstacles households face to improve their economic situation. The main focus of the analysis is to investigate the importance of health, education, and infrastructure indicators for income growth. The second question asks whether growth in Albania during the period 2002-2004 has been pro-poor. I find that there is some evidence for a convergence of incomes and a pro-poor growth, which has led to a substantial decrease in the number of people living under the poverty line. I also find that infrastructure has not been an important determinant for income mobility, and neither has health. Only the higher education of poor urban households seems to have affected prospects for growing out of poverty, and unexpectedly, the relationship is negative.

Agricultural incentives, growth and poverty in Latin America and the Caribbean: cross-country evidence for the period 1960-2005. Did trade liberalization increase the incomes of the poorest?

Includes bibliography

Growth, poverty and inequality in Central America

Includes bibliography

Health and Growth: Causality through Education

Purpose--The paper theoretically and empirically investigates the impact on human capital investment decisions and income growth of lowered life expectancy as a result of HIV/AIDS and other diseases. Design/methodology/approach--The theoretical model is a three-period overlapping generations model where individuals go through three stages in their life, namely, young, adult and old. The model extends existing theoretical models by allowing the probability of premature death to differ for individuals at different life stage, and by allowing for stochastic technological advances. The empirical investigation focuses on the effect of HIV/AIDS on life expectancy and on the role of health on educational investments and growth. We address potential endogeneity by using various strategies, such as controlling for country specific time-invariant unobservables and by using the male circumcision rate as an instrumental variable for HIV/AIDS prevalence. Findings--We show theoretically that an increased probability of premature death leads to less investment in human capital, and consequently slower growth. Empirically we show that HIV/AIDS has resulted in a substantial decline in life expectancy in African countries and these falling life expectancies are indeed associated with lower educational attainment and slower economic growth world wide. Originality/value--The theoretical and empirical findings reveal a causal link flowing from health to growth, which has been largely overlooked by the existing literature. The main implication is that health investments, that decrease the incidence of diseases like HIV/AIDS resulting on increases in life expectancy, through its complementarity with human capital investments lead to long run growth..

Income, Trade and Pollution in Central Asia, Russia and China: An Econometric Analysis

The study performs a panel estimation of the relationship between per capita income, trade, and airborne pollution in the five Central Asian nations, Russia and China between 1992 and 2008. First, this study uses an environmental Kuznets curve hypothesis (EKC)- an inverted-U relationship between the increase in income and the level of environmental degradation - to examine how income and pollution are related. Second, the study uses a gravity model to estimate the effect of a regional trade agreement (Shanghai Cooperation Organization: SCO) on incomes and carbon dioxide emissions in the region. Empirical analysis confirms the existence of the rising portion of the EKC curve in the region - a positive correlation between per capita income growth and carbon dioxide emissions- and that the volume of bilateral trade, and not the existence of a regional trade agreement, contributes to the increasing level of environmental pollution.

Income, Trade and Pollution in Central Asia, Russia and China: An Econometric Analysis

The study performs a panel estimation of the relationship between per capita income, trade, and airborne pollution in the five Central Asian nations, Russia and China between 1992 and 2008. First, this study uses an environmental Kuznets curve hypothesis (EKC)- an inverted-U relationship between the increase in income and the level of environmental degradation - to examine how income and pollution are related. Second, the study uses a gravity model to estimate the effect of a regional trade agreement (Shanghai Cooperation Organization: SCO) on incomes and carbon dioxide emissions in the region. Empirical analysis confirms the existence of the rising portion of the EKC curve in the region - a positive correlation between per capita income growth and carbon dioxide emissions- and that the volume of bilateral trade, and not the existence of a regional trade agreement, contributes to the increasing level of environmental pollution.