Abolfazl Shahabadi; Behzad Amiri; Sara Sarigol
Abstract
In recent decades, reducing income inequality has become one of the major objectives of economic and social development and even important part of governments’ tasks. Thus, studying equal distribution of income and trying to find its causes are important to achieve sustained and stable economic ...
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In recent decades, reducing income inequality has become one of the major objectives of economic and social development and even important part of governments’ tasks. Thus, studying equal distribution of income and trying to find its causes are important to achieve sustained and stable economic growth and development. Consequently, this study is using conventional econometrics technique (panel data approach) to evaluate the effect of governance on income equality in selected NAM countries during the period 1996-2012. The results show that governance variable has positive and significant effect on income equality in countries under study. Based on the estimation results, the effect of financial development, human capital, subsidies granted by the government on equal income distribution are positive and significant. The effect of synthesized variable of difference between labor compensation growth rate and inflation on income equality is positive but insignificant. Interaction effect of natural resources and governance variables on income equality is positive and significant.
