Inequality and economic growth: the role of initial income

  title={Inequality and economic growth: the role of initial income},
  author={Markus G. Brueckner and Daniel Lederman},
  journal={Journal of Economic Growth},
We estimate a panel model where the relationship between inequality and GDP per capita growth depends on countries’ initial incomes. Estimates of the model show that the relationship between inequality and GDP per capita growth is significantly decreasing in countries’ initial incomes. Results from instrumental variables regressions show that in Low Income Countries transitional growth is boosted by greater income inequality. In High Income Countries inequality has a significant negative effect… Expand
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