...in non-income dimensions. One views inequality as variation of an outcome indicator across individuals and the other views inequality as essentially disparities across socioeconomic groups. While the latter view now dominates the inequality measurement in health, measurement of education inequalities has so far taken the first view. In this paper, we have argued the importance of reckoning inequality in socio-economic group terms and advocated use of an ‘education concentration index’ exactly in the same way as the health concentration index measures socio-economic inequalities in health. The index has been applied to the Indian data to reckon two kinds of inequalities in educational attainment (years of education) – one across economic classes and the other across socially identified groups such as the Scheduled Tribes, Scheduled Castes and others. We find a strong correlation between the two types of inequalities across the states of India. We also find, as one would expect, that the inequality index values are negatively correlated with the average years of education. However, in actual policy context, analysis of the outliers might be more illuminating than studying the general pattern. 1. Introduction Inequalities in the specific dimensions of human functioning, such as health and education, have been drawing increasing attention of researchers and policy analysts in recent years. What is behind this growing attention is perhaps the view –...
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...Innovation in BRICS Busines - Way of growth and sustainability strategy Chirinos Adriana Wuhan University of Technology, School of Management, Wuhan 430070 P.R. China （E-mail:adrianachirinos20@hotmail.com) Abstract: The last decade has presented a new global economic scenario lead by emerging markets. BRICS countries (comprised by Brazil, Russia, India, China and South Africa) have been at the forefront in this phenomenon. During these years, the real Gross Domestic Product (GDP) growth of the world (annual percent change - A% c) averages 3,83. It is worth mentioning that the above referenced countries reached 6,01 (157,02% more); and Advanced Economies - not yet recovered since the last financial crisis - reached 1,6 (47,78%). Meanwhile, different measuring models have found that in the world, just the top 20% of the population controls over 70% of the global revenue. These economies have been growing as well. The importance of this investigation is answering the questions: Are they reversing this lack of equality trend? And, Would be relevant to add equity in the development agenda?. This paper offers an analysis of these points and studies them as a strategy for sustainability and continuous growth. Key words: BRICS countries growth; National income distribution; Equity in the development agenda. 1. Introduction BRICS Countries are leading the growth of the economy in the world, and have done so for over 10 years. The International Monetary Fund (IMF)...
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...Definition Gini coefficient refers to the different in poverty and wealth in any given country. On a scale of 0 to 1, the lower the Gini coefficient, the more evenly distributed the wealth. Gini coefficient or Gini index is an economic measure of inequality in income distribution. Gini coefficient is specified as a ratio between 0 and 1. A society that tallies 0.0 on the Gini scale is said to possess perfect equality in income distribution. A society with a score of 1 suggests total inequality. Gini coefficient expects that no person in a society has negative wealth or net income. The coefficient is named after its inventor, the Italian statistician Corrado Gini (23rd May, 1884-13th March, 1965). The Gini coefficient is usually defined mathematically based on the Lorenz curve, which plots the proportion of the total income of the population (y axis) that is cumulatively earned by the bottom x% of the population (see diagram). The line at 45 degrees thus represents perfect equality of incomes. The Gini coefficient can then be thought of as the ratio of the area that lies between the line of equality and the Lorenz curve (marked 'A' in the diagram) over the total area under the line of equality (marked 'A' and 'B' in the diagram); i.e., G=A/(A+B). The Gini coefficient can range from 0 to 1; it is sometimes multiplied by 100 to range between 0 and 100. A low Gini coefficient indicates a more equal distribution, with 0 corresponding to complete equality, while higher Gini coefficients...
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...prices, which in-turn has improved the standard of living over the past decade. It is a common fact that the richer are happier than the poor. But well being is a matter of perception as well. People asses their well being by comparing their past and current circumstances, and by comparing their current standard with that of others. The Easterlin Paradox, which was developed by Richard Easterlin,, states that “although at some point in time richer individuals are happier, over time economic growth is not accompanied with an increase in aggregate happiness.” . According to studies, once an income level of approximately $10,000 is reached, any increase in income has limited effect on subjective wellbeing. The Trading economics defines Gini index, as measures the extent to which the distribution of income among individuals or households...
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...3.2 Theoretical development The theoretical view in economic inequality has a long history. The deliberation of fair distribution can be old-fashioned to classical economist David Recardio and leftist theoretical matters as Karl Marx. These theorists have already documented the magnitude of distribution in the society, and among different classes of the people. 3.2.1 Kuznets Hypothesis: A reasonably moderate theory which has prevailed in the mainstream academia for about half a century is attributed to Kuznets (1955), which argues that income inequality would change as economic growth changes or more precisely, income inequality would rise first and then decline with economic growth. This theory is related with factor movement between sectors where there is inequality, which permits income distribution does not need to be fully equalized. This theory implies that fairer distribution may lead to higher productivity.[1] Kuznets curve is the graphical representation of Simon Kuznets's theory ('Kuznets hypothesis') that economic inequality increases over time while a country is developing, then after a critical average income is attained, begins to decrease. Figure 3.1: Graphical representation of Kuznets curve One theory as to why this happens, in early stages of development, when investment in physical capital is the main mechanism of economic growth, inequality encourages growth by allocating resources towards those who save...
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...Democracy, Religion and Inequality University of Groningen Faculty of Economics and Business Bachelor Thesis International Economics and Business Name Student: Yitian Jing Student ID Number: s2012790 Student email: y.jing@student.rug.nl Date Thesis: Jun. 5th, 2012 Name Supervisor: Dr. Robbert K. J. Maseland First and foremost, I would like to express my sincere appreciation and gratitude to my advisor, Dr. R. K. J. Maseland, for his academic guidance and encouragement throughout the research. He has been very generous sharing his experiences on institutional and cultural determinants on economy, as well as on academic research methodology and beyond. I would not have finished such a thesis paper without his support. His effort and patience would never be forgotten. Abstract The democracy’s inequality decreasing effect has been appealing to researchers for long but lacks concentrated argumentation and empirical evidence, as well as the interaction between democracy and religion. This paper conduct an empirical analysis covering time period of 1978-2010 with 86 countries to test the hypotheses of whether democracy decreases inequality and whether an egalitarian religion decreases the influence of democracy. The result shows the direct effect of democracy is weak, however, the hypothesis of religion’s effect on the democracy’s influence is partially confirmed. Therefore, democracy itself has minor influence on inequality while a large proportion of the effect is...
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...JAGANNATH UNIVERSITY DEPARTMENT OF FINANCE JAGANNATH UNIVERSITY DEPARTMENT OF FINANCE COURSE TITLE Public finance COURSE CODE: 3105 COURSE TITLE Public finance COURSE CODE: 3105 AN ASSIGNMENT ON EFFECTS OF PUBLIC EXPENDITURES ON THE DISTRIBUTION OF INCOME AN ASSIGNMENT ON EFFECTS OF PUBLIC EXPENDITURES ON THE DISTRIBUTION OF INCOME SUBMITTED TO: Ayesha Akhter Lecturer DEPARTMENT OF FINANCE FACULTY OF BUSINESS STUDIES JAGANNATH UNIVERSITY Ayesha Akhter Lecturer DEPARTMENT OF FINANCE FACULTY OF BUSINESS STUDIES JAGANNATH UNIVERSITY SUBMITTED BY: Group-01 DEPARTMENT OF FINANCE JAGANNATH UNIVERSITY Group-01 DEPARTMENT OF FINANCE JAGANNATH UNIVERSITY Name of the group members: SL NO. | NAME | ID NO. | 01 | ROBIUL ISLAM RUBEL | B-120203019 | 02 | MD.ABUL KALAM AZAD | B-120203023 | 03 | LAMIA AKTER | B-120203036 | 04 | ASIF AL SAIF | B-120203139 | 05 | MAHMUDUL HASSAN | B-120203102 | 06 | MOHAMMAD MEHADI HASAN | B-120203097 | 07 | ROMANA AKTER PRIA | B-120203059 | 08 | MITHUN KUMER | B-120203041 | 09 | MD.ABU SAYED | B-120203026 | 10 | MOHAMMAD RUHUL AMIN | B-120203062 | TABLE OF CONTENTS SL. NO...
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...Inequality and Growth in a Panel of Countries* Robert J. Barro, Harvard University June 1999 Abstract Evidence from a broad panel of countries shows little overall relation between income inequality and rates of growth and investment. However, for growth, higher inequality tends to retard growth in poor countries and encourage growth in richer places. The Kuznets curve—whereby inequality first increases and later decreases during the process of economic development—emerges as a clear empirical regularity. However, this relation does not explain the bulk of variations in inequality across countries or over time. *This research has been supported by a grant from the National Science Foundation. An earlier version of this paper was presented at a conference at the American Enterprise Institute. I am grateful for excellent research assistance from Silvana Tenreyro and for comments from Paul Collier, Bill Easterly, Jong-Wha Lee, Mattias Lundberg, Francisco Rodriguez, Heng-fu Zou, and participants of a seminar at the World Bank. 2 A substantial literature analyzes the effects of income inequality on macroeconomic performance, as reflected in rates of economic growth and investment. Much of this analysis is empirical, using data on the performance of a broad group of countries. This paper contributes to this literature by using a framework for the determinants of economic growth that I have developed and used in previous studies. To motivate the extension of this...
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...and the Lorenz Curve 1 Market economies are favored and well-known for generating macroeconomic growth and progress in industrialized nations, such as the United States. Numerous academic studies and economic research have been done not only to measure economic growth, but also to analyze any disparities in income distributions among the general American population. This paper will examine trends and patterns of American wages since the 1970s, focusing on shifts in income distributions to see if these shifts can be interpreted as income inequality across different sectors of our society. Furthermore, this paper will study two important and interlinked methods of measuring income inequality, which are the Lorenz Curve and the Gini Coefficient Index. The Executive Branch of our federal government and the U.S. Congress keep a close eye on income distributions throughout the entire nation. These bodies rely heavily on data collected and analyzed by non-partisan agencies such as the U.S. Census Bureau, the Internal Revenue Service (IRS), the U.S. Bureau of Economic Analysis, the Congressional Budget Office (CBO), and academic institutitions that provide data and statistical analysis to assist in economic and budgetary decisions made by elected officials concerning a wide array of policy issues such as taxes, social insurance programs and other issues that impact the overall economy. Economists like Thomas Piketty and Emmanual Saez and many others have used these collected data...
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...POVERTY: ITS EFFECTS TO THE PHILIPPINE ECONOMY A Research Paper Submitted to Ms. Antonia D. Entino Instructor A Partial Fulfillment of the Requirements for the course Eng. R: Writing in the Discipline By: Charlene P. Trenchera Sheila Mae O. Calites April Faith S. Negros Joana F. Santizo Annaliza S. Lar Jonel V. Verzosa Khim Arjay S. Pica Group I BS-Economics IB March, 2016 ACKNOWLEDGEMENT The researchers would like to thank express their heartfelt gratitude to the individuals who helped in making this research a success. Especially to our Creator, who gave us strength and wisdom to finish this research paper. Special thanks to our parents who supported us financially, spiritually and emotionally which are a big help in the compilation of this study. Special thanks to our English Teacher, Ms. Antonia D. Entino for the patience and determination in teaching us all about research writing. Without her untiring effort this study will not be successful. To all the persons who helped us to finish this study. Thank you a lot. CHAPTER I INTRODUCTION Background of the Study Poverty is general scarcity, dearth, or the state of one who lacks a certain amount of material possessions or money.[1] It is a multifaceted concept, which includes social, economic, and political elements.[2] Poverty may be defined as either absolute or relative poverty or destitution refers to the lack of means necessary...
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...Gini coefficient From Wikipedia, the free encyclopedia http://en.wikipedia.org/wiki/Gini_coefficient Graphical representation of the Gini coefficient The Gini coefficient is a measure of inequality of a distribution. It is defined as a ratio with values between 0 and 1: the numerator is the area between the Lorenz curve of the distribution and the uniform distribution line; the denominator is the area under the uniform distribution line. It was developed by the Italian statistician Corrado Gini and published in his 1912 paper "Variabilità e mutabilità" ("Variability and Mutability"). The Gini index is the Gini coefficient expressed as a percentage, and is equal to the Gini coefficient multiplied by 100. (The Gini coefficient is equal to half of the relative mean difference.) The Gini coefficient is often used to measure income inequality. Here, 0 corresponds to perfect income equality (i.e. everyone has the same income) and 1 corresponds to perfect income inequality (i.e. one person has all the income, while everyone else has zero income). The Gini coefficient can also be used to measure wealth inequality. This use requires that no one has a negative net wealth. It is also commonly used for the measurement of discriminatory power of rating systems in the credit risk management. Calculation The Gini coefficient is defined as a ratio of the areas on the Lorenz curve diagram. If the area between the line of perfect equality and Lorenz curve is A, and the area under...
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...1) Derived demand is used in economics to describe the demand that is placed on goods or a good or service as a consequence of changes in the price for some other related good or service. It is a demand for some physical or intangible item where a market exists for both related goods and services in question. The derived demand can have a significant impact on the derived good's market price. The concept of derived demand helps to control the demand for labor through one product needing the use of another product. (Tejvan Pettinger, November 28, 2012) 2) The factors that govern the source of labor in a market are buyers and sellers. Most markets we come across individual people such as you and I and groups of people such as families that needs goods and services and the firms which supply goods and services, such as stores. The labor market works in a parallel way, except the roles are reverse. This market, mostly all firms require labor and individuals such as you and I supply their requirement for a wage compensation. By looking for a job, you are participating actively in the market of labor. The labor market works much like other markets. There are buyers and sellers and they both interact with one another to determine a price of an item. In this case, the "good" being bought and sold is labor and the price for that good is the wage compensation mention earlier. That is, in the labor market, employers are willing to buy more hours of labor at lower wages than at a higher...
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...income mobility in absolute terms, we would measure whether a person's income: *A. | is higher than her parents' income. | B. | places her higher up in the income distribution than her parents' income. | C. | is higher at the end of her career compared to the beginning. | D. | places her higher up in the income distribution over the course of her work-life. | | Income mobility measures inter-generational changes in income. The absolute mobility is A) whereas the relative mobility is B). 4. | Which curve summarizes inequality visually? *A. | Lorenz curve | B. | Laffer curve | C. | Income Inequality curve | D. | Gini curve | | The Lorenz curve measures inequality visually. The Laffer curve is a measure of tax revenue and we did not discuss C) or D) though we did discuss the “Gini coefficient”. 5. | A Gini coefficient of zero indicates: *A. | perfect equality. | B. |...
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...Malaysia’s economic sphere of influence has been constantly growing on the world market and has attracted a lot of attention in the past years as a rapidly developing country in a very dynamic region. This can be shown with the amount of Foreign Direct Investments (FDI) Malaysia receives and has received throughout the years even within a context of a worldwide recession and a global economic crisis. Firstly, I will explain more in detail what an FDI is, the trend it has been following in Malaysia and the way it has been growing on the time span of 1990 to 2010. Secondly, I will mention the rate of growth in Malaysia’s economy by analyzing its Gross Domestic Product and its economic growth in general and finally I will try to find a link between this trend that FDIs are following in Malaysia and how the Malaysian society is evolving in terms of transfer of technology, employment, income distribution and poverty and environment. A Foreign Direct Investment is an “overseas equity investment by a private multinational corporations” according to Todaro and Smith’s Economic development. Almost every country in the world has been known to emit FDIs as well as receive them. Malaysia is no different, especially being in such a dynamic region, Southeast Asia , it has attracted a lot of foreign businesses and continues to attract them as we will show later on in the paper. The reason Malaysia attracts foreign firms is not...
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...Introduction Regardless of the context, all human action is ultimately the result of both motivational and cognitive factors (Locke, 2000; Shane et al., 2003). Individuals are motivated to engage in entrepreneurial endeavors driven mainly by necessity or opportunity (Block and Wagner, 2010; Lippmann et al., 2005; Reynolds et al., 2002; Verheul et al., 2010), meaning that, for example, individuals pursue entrepreneurship primarily due to survival needs or because they identify business opportunities that satisfy their need for achievement. Extant literature often argues that opportunity-based entrepreneurship is more likely to involve a new product, service, or underserved market need and is usually preferred over necessity entrepreneurship by those individuals with relatively higher levels of human and financial capital (Block and Wagner, 2010; Lippmann et al., 2005; Reynolds et al., 2002; Verheul et al., 2010). Concurrently, opportunity entrepreneurship is expected to have a greater potential to foster productivity levels (Block and Wagner, 2010; Wennekers et al., 2005; Wong et al., 2005) by contributing to the technological shocks that neoclassical economists identify as the key drivers of economic growth (Kydland and Prescott, 1982). Although necessity entrepreneurship can potentially contribute to growth too, its economic impact is more likely to be redistributive (Lippmann et al., 2005). The motivation to pursue and engage in entrepreneurship is expected to...
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