Eradicating Income Inequality in Lower Middle-Income Countries

Abstract

Studying the distribution of income is an important issue to know what factors which affect to make income distribution more equitable, what factors can be the key to resolving the problem of income inequality, and shortening the distance between the poor and the rich. This paper studies the relationship between human capital, inflation rate, unemployment rate, physical capital, fiscal expenditure, gross domestic product growth, and urbanization on income inequality in 52 Lower Middle-Income Countries throughout 1990-2014. The authors estimate the impact of seven independent variables on income inequality as a dependent using Prais-Winsten with the robust model over period 1990-2014 at 52 Lower Middle-Income Countries. The results indicate an increase in human capital (gross school enrollment tertiary) can make the income distribution more even in the long run. The writers conclude that increases in human capital can reduce Gini coefficient and hence make income distribution fairer.

Sectoral Growth and Income Inequality in ASEAN-5 Countries: Case of Low-Middle Income Economies

“…In fact, this phenomenon can damage productivity and innovation through a number of channels, such as unequal education, which can damage human capital accumulation process, and results in low productivity and decreased economic growth (Paus, 2017). Therefore, lack of education and health services combined with deficiency in redistributive policies, such as conditional cash transfer and tax reform have become major factors for increasing income inequality in emerging and low-middle income economies (Brueckner, Dabla-Norris, and Gradstein, 2014;Dabla-Norris, Kochhar, Suphaphiphat, Ricka, Tsounta, 2015;Fournier and Johansson, 2016;Pratysto and Panjaitan, 2019).…”

The Role of Human Capital and Regional Effects on Earnings: Multilevel Mixed Effect Regression Approach

“…The higher the level of education, the higher the performance (Dhian et al, 2013). A study in middle-income countries revealed that the disparity of human capital contributed to income inequality (Pratysto and Panjaitan, 2019). Experience also influences worker earnings (Ratna and Fauziah, 2018).…”

Digital Financial Transformation in The Financial Inclusion Program and Its Impact on Income Inequality: The Case of Middle-Income Countries

“…Differences in the endowment of natural resources and the demographic circumstances observed in each place can be the first causes of inequality [1]. Given that the allocation of economic resources will have a significant impact on income disparity, it is crucial to address this issue, particularly in emerging nations [2]. More focus is needed on why the government hasn't been able to considerably reduce poverty and income inequality, and in particular, what could be causing the poor economic growth that has an effect on poverty levels and income inequality [3].…”