Using data from 40 countries over 80 years, this paper analyzes economic growth in terms of GDP, GDP change, GDP per capita, income inequality in terms of the Gini index, and government social spending in terms social contributions in both the currency and as a percentage of GDP, to determine the relationship between growth and income distribution.
Based on the multivariate regression output, this study has shown that as a country grows economically, the Gini index increases. Concurrently, social spending begins to increase, albeit slowly. However, at a point, the Gini index plummets as the amount of social contributions drastically increases. Based on this, the hypothesis is correct in poor countries, but is incorrect in wealthy countries.
Jay Chittooran is a Research Fellow at the Streit Council for a Union of Democracies in Washington D.C.
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May 16, 2010
Zied
how to get it? i mean the hard copy. thank you.