Long-run relationship between inequality and growth in post-reform China: New evidence from dynamic panel model

Li, Tingting; Lai, Jennifer T.; Yong, Wang; Zhao, Dingtao

doi:10.1016/j.iref.2015.08.009

Cited by 21 publications

(14 citation statements)

References 33 publications

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“…Nissim (2007) and Binatli (2012) also provide the same conclusion that there is a negative relationship between the two variables. However, this finding is not in line with the study conducted by Li et al(2016) for the case of Chinese economy proving the empirical evidence that there exists a robust positive long-run relationship between income inequality and growth in post-reform China.…”

Section: The Results Of Panel Vector Error Correction Modelcontrasting

confidence: 68%

Is There Causality Relationship Between Economic Growth and Income Inequality?: Panel Data Evidence From Indonesia

Amri¹,

Nazamuddin²

2018

EJEF

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Our study aims to determine the causality relationship between economic growth and income inequality. Using panel data set of 26 provinces from Indonesia for a period of 2005 to 2015, Pedroni's co-integration test, Panel Vector Error Correction Model, and Granger Causality Test were employed to analyze the relationship between the variables. Accordingly, the first main finding of the research is that there is a negative and significant relationship between the economic growth and income inequality in the long-run. Secondly, in the short run, the economic growth is positively and insignificantly related to income inequality. In addition, there is a unidirectional causality running from income inequality to economic growth.

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Section: The Results Of Panel Vector Error Correction Modelcontrasting

confidence: 68%

Is There Causality Relationship Between Economic Growth and Income Inequality?: Panel Data Evidence From Indonesia

Amri¹,

Nazamuddin²

2018

EJEF

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“…According to this view, human capital input augments the production activity without increasing the total factor productivity, that is, the accumulation of human capital increases productivity through the input factor only. The second strand of literature shared the perspective that human capital is essential to increase total factor production, this channel is termed the advanced channel of human capital (Vandenbussche, Aghion & Meghir, 2006;Romer, 1990;Aghion & Howitt, 1992;Nelson & Phelps, 1990;Schultz, 1961;Becker, 1962;Nelson & Phelps, 1966).The advanced channel includes investment in research and development and the enhancement of skills to adapt and diffuse new technologies.While another strand of literature documented that no significant connection between human capital channels and productivity due to many factors, such as the effect of external shocks from different production processes and service delivery (Li, Lai, Wang & Zhao, 2016). pointed out that understanding the connection between human capital and productivity does not only depend on other factor inputs but on the differences among the level of human capital in each given countries.…”

Section: Literature Reviewmentioning

confidence: 99%

“…At the same time, determining the channels of human capital on growth and development is of main interest to promote sustainability. Another strand of literature shares the view that the presence of human capital does not increase productivity growth in all cases due to external shocks from different production processes and service delivery (Li, Lai, Wang & Zhao, 2016). Given this circumstance, it is essential to improve human capacity to adjust to different economic situations.…”

Section: Introductionmentioning

confidence: 99%

“…Nigeria has abundant human and natural resources but it still faces numerous developmental challenges such as high poverty rate, high unemployment rate and low income per capita (Popoola, Asaleye & Eluyela, 2018;Asaleye, Olurinola, Oloni & Ogunjobi, 2017;Asaleye, Popoola, Lawal, Ogundipe & Ezenwoke, 2018). One of the reasons attributed to low productivity growth, according to some scholars, is low rate of investment in human capital, another reason is the inability to know the right channel of human capital investment to embark on (Li, Lai, Wang & Zhao, 2016).…”

Section: Introductionmentioning

confidence: 99%

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Human capital channels and productivity growth: Evidence from Nigeria

Popoola

Alege

Gershon

et al. 2019

Economics &Amp; Sociology

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Numerous studies have examined the relationship between human capital and productivity. However, the implications of human capital channels-the 'basic channel' and 'advanced channel'-were discounted from most of the empirical studies in Africa. This study, therefore, uses Vector Error Correction Model to examine the joint short-and long-run causality, as well as long-run behaviour of human capital channels on productivity within the period from 1980 to 2017. Evidence from the joint short-and long-run causality shows that there is no long-run one while joint short-run causality was observed in the basic channel, in the advanced channel there is both joint short-and long-run causality. For the long-run equation, primary school enrollment/secondary school enrollments have insignificant effect on productivity growth while tertiary institution enrollment and government expenditure on education have a positive effect on productivity growth. However, contribution of both effects is less than one per cent, thus showing low responsiveness of the inputs on productivity. The implications from this result are that human capital formation through education and investment in research and development have not promoted productivity in Nigeria. Investment in research and development is imperative to promote productivity and enhance the skills needed to adapt and diffuse new technologies.

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“…There are primarily the following views on the mechanism: Firstly, human capital directly participates in the production process as a production factor that improves the quality of labor, and the accumulation of specialized human capital is the decisive factor in promoting sustained economic growth (Lucas, 1988). Secondly, human capital promotes the indirect effects of economic growth by fostering technological innovation and technological catch-up, emphasizing that the stock of human capital is a critical factor in economic growth (Romer, 1990;Ding & Knight, 2011; F Li et al, 2016). Thirdly, human capital directly affects output as a factor and indirectly promotes a joint mechanism of economic growth by promoting technological innovation and imitating absorption (Engelbrecht, 2003;Du et al, 2014).…”

Section: The Mechanism and Direction Of Human Capital In Economic Growthmentioning

confidence: 99%

The Impact of Higher Education and Human Capital Quality on “Local-Neighborhood” Economic Growth

Zhao

2021

Best Evid Chin Edu

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Based on China’s provincial panel data from 1990 to 2017 and the improved Lucas, Nelson & Phelps model, the Spatial Dubin Model is used to test the spatial effects of higher education and human capital quality. The results showed that high-level human capital, characterized by higher education and urban labor income index, indirectly promoted local economic growth through technological innovation. There was also a “local-neighborhood” synergy effect. The neighborhood effect was manifested in that it affected the economic development of neighbors by promoting technological catch-up. After considering the quality factor, both the local and neighborhood effects were enhanced. From a regional perspective, higher education in the Yangtze River Delta, where the level of economic development is relatively high, was manifested as a spatial spillover effect of technological innovation and the neighborhood effect in the northeastern Bohai Rim and the Pearl River Delta was manifested as a technological catch-up.

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Long-run relationship between inequality and growth in post-reform China: New evidence from dynamic panel model

Cited by 21 publications

References 33 publications

Is There Causality Relationship Between Economic Growth and Income Inequality?: Panel Data Evidence From Indonesia

Is There Causality Relationship Between Economic Growth and Income Inequality?: Panel Data Evidence From Indonesia

Human capital channels and productivity growth: Evidence from Nigeria

The Impact of Higher Education and Human Capital Quality on “Local-Neighborhood” Economic Growth

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