Inequality Convergence

Comparing changes in inequality with initial levels, using new data, the author finds that within-country inequality in income or per capita consumption is converging toward medium levels--a Gini index around 40 percent. The finding is robust to al...

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Bibliographic Details
Main Author:	Ravallion, Martin
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	ANNUALIZED CHANGE ARITHMETIC PROGRESSIONS AVERAGE GROWTH AVERAGE INCOMES AVERAGE PROCESS CONTINUING CONVERGENCE CONVERGENCE PARAMETER CONVERGENCE PROCESS CONVERGENCE TEST CONVERGENCE TESTS COUNTRY INEQUALITY COUNTRY-SPECIFIC AUTOREGRESSION COEFFICIENTS COUNTRY-SPECIFIC INTERCEPTS COUNTRY-SPECIFIC TREND COUNTRY-SPECIFIC TRENDS COVARIANCE MATRIX COVARIANCE MATRIX ESTIMATOR CROSS-COUNTRY COMPARISONS CROSS-COUNTRY PANEL DATA COMPILATIONS DATA MODEL DATA QUALITY DATA SET DATA SETS DEPENDENT VARIABLE DEVELOPING COUNTRIES DEVELOPMENT INDICATORS DEVELOPMENT RESEARCH DISTRIBUTIONAL DATA DYNAMIC STRUCTURE ECONOMIC GROWTH ECONOMIC POLICY ECONOMIC POLICY CONVERGENCE ECONOMIC REFORM ECONOMIC RESEARCH ECONOMIC REVIEW EDUCATION SYSTEMS EXCHANGE RATE EXCHANGE RATE REGIME EXPLAINING INEQUALITY EXPLANATORY VARIABLES EXTRA DUMMY VARIABLES GINI INDEX GROWTH EMPIRICS GROWTH FUNDAMENTALS GROWTH-PROMOTING POLICY HETEROSKEDASTICITY HIGH INEQUALITY HOUSEHOLD SURVEYS HOUSEHOLD WELFARE HUMAN CAPITAL IDENTIFICATION ASSUMPTIONS IDIOSYNCRATIC SHOCKS INCOME INCOME DISTRIBUTION INCOME INEQUALITY INCOMES SURVEYS INDEPENDENT MEASUREMENT INDEPENDENT MEASUREMENT ERROR INDIVIDUAL COUNTRIES INDIVIDUAL INCOMES INEQUALITY INEQUALITY CONVERGENCE INEQUALITY DATA INEQUALITY INDEX INEQUALITY MEASURE INEQUALITY MEASURES INEQUALITY TRENDS INEQUALITY WILL INEQUALITY WILL INCREASE JOB CREATION LAGGED VALUE LINEAR REGRESSION LINEAR RELATIONSHIP LOCAL INSTITUTIONS LOG GINI MACROECONOMIC PERFORMANCE MACROECONOMICS MARKET ECONOMY MARKET-ORIENTED ECONOMY MEAN ERROR TERM MEAN INCOME MEAN INCOME CONVERGENCE MEASURED INEQUALITY MEASUREMENT ERROR MEASUREMENT ERRORS MEASURING INCOME INEQUALITY MEASURING INEQUALITY MEDIUM INEQUALITY MEDIUM LEVELS MICRO DATA NATIONAL ACCOUNTS NEGATIVE COEFFICIENTS NEGATIVE CORRELATION NEGLIGIBLE DIFFERENCE NEOCLASSICAL GROWTH NEOCLASSICAL GROWTH MODEL NEOCLASSICAL GROWTH PROCESS NEOCLASSICAL MODEL OBSERVED CHANGE OBSERVED CHANGES PENSION REFORM PER CAPITA CONSUMPTION PER CAPITA DISTRIBUTIONS POLICY DISCUSSIONS POLICY ISSUES POLICY REFORMS POLICY RESEARCH POLITICAL CONSTRAINTS PREDICTED INITIAL PRO-POOR PRO-POOR DISTRIBUTIONS PUBLIC GOODS PUBLIC POLICY QUALITY GROWTH SECONDARY SOURCES SERIAL CORRELATION SERIAL DEPENDENCE SERIAL INDEPENDENCE SERIES ECONOMETRICS SERIES OBSERVATIONS SERIES OBSERVATIONS CASTS SHORT SERIES SHORT-RUN DYNAMICS SHORT-TERM DYNAMICS SIGNIFICANT NEGATIVE STATISTICAL METHODS SURVEY DESIGN TRANSITION ECONOMIES WELFARE INDICATORS WORLD INCOME DISTRIBUTION
Online Access:	http://documents.worldbank.org/curated/en/2001/07/1552003/inequality-convergence http://hdl.handle.net/10986/19593

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Summary:	Comparing changes in inequality with initial levels, using new data, the author finds that within-country inequality in income or per capita consumption is converging toward medium levels--a Gini index around 40 percent. The finding is robust to allow for serially independent measurement error in inequality data and for short-run dynamics around longer-term trends. However, the convergence process is neither rapid nor certain, and more observations over time are needed to be confident of the pattern. The author offers an approach to modeling the determinants of inequality that may be a starting point for estimating richer models.

Inequality Convergence

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