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Inequality, Democracy, and Persistence: Is There a Political Kuznets Curve?
Author(s) -
Chong Alberto
Publication year - 2004
Publication title -
economics and politics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.822
H-Index - 45
eISSN - 1468-0343
pISSN - 0954-1985
DOI - 10.1111/j.1468-0343.2004.00137.x
Subject(s) - kuznets curve , simultaneity , ordinary least squares , democracy , econometrics , inequality , economics , persistence (discontinuity) , economic inequality , monotonic function , panel data , instrumental variable , simultaneous equations model , control variable , politics , mathematics , statistics , political science , mathematical analysis , engineering , physics , geotechnical engineering , classical mechanics , law
The aim of this paper is to provide comprehensive empirical evidence on recent theories that link democracy and income inequality for the period 1960–1997. In simple cross‐country regressions I find a non‐monotonic link between democracy and inequality when using ordinary least squares, instrumental variables, and Eusufzai tests. I also employ dynamic panel data techniques, which control for potential simultaneity and heterogeneity problems. I also find support for the existence of apolitical Kuznets curve. Moreover, it appears that income inequality is unconditionally persistent. Results are robust to different democracy proxies when sensitivity analysis is applied.