The Trend Behavior of Alternative Income Inequality Measures in the United States from 1947-1990 and the Structural Break

Abstract

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The Great Leap Forward, Economic Reforms, and the Unit Root Hypothesis: Testing for Breaking Trend Functions in China's GDP Data

“…Another implication pertains to the effectiveness of short-run macroeconomic policies. The difference-stationarity view implies that any shock to the level of output will have a higher magnitude of persistence due to the large size of the unit root (Raj and Slottje, 1994). Accordingly, macroeconomic stabilization policies may not be very effective in dealing with the detrimental consequences of the Asian financial shock to the Chinese economy (Wang, 1999).…”

“…However, some recent trends of time series research run counter to this view. See, for example, Perron (1989Perron ( , 1994Perron ( , 1997, Raj (1992), Raj and Slottje (1994), Ben-David andPapell (1995), andDolmas et al (1999). These authors examine the historical data set of real GDP, productivity, income inequality, and other such variables for various developed countries and find that they are characterized not by the presence of a unit root but by stationary fluctuations around a breaking deterministic trend.…”

Explaining International and Intertemporal Variations in Income Inequality

“…For the US data which have the longest time series, the simple Augmented Dickey-Fuller test suggests the presence of a unit root. However, in Raj and Slottje (1994), they found that the US Gini is stationary around a broken trend.…”

Unit Roots, Trend Breaks, and Transitory Dynamics: A Macroeconomic Perspective

“…original Nelson-Plosser data). Although this sample size may appear low, some studies use the asymptotic Zivot-Andrews test for samples as small as 44 annual observations [Raj and Slottje (1994)] or 27 annual observations [Alba and Papell (1995)]. However, since other studies use larger sample sizes, we also repeated the analysis with 124 observations.…”