The Journal of Economic Inequality

, Volume 8, Issue 3, pp 293-321

First online:

Inequality and growth in advanced economies: an empirical investigation

  • Amparo Castelló-ClimentAffiliated withInstituto de Economía Internacional, Facultad de Economía, Universidad de Valencia Email author 

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This paper empirically investigates the effect of income and human capital inequality on economic growth in different regions of the world. In the estimation of a dynamic panel data model that controls for country-specific effects and takes into account the persistency of the inequality indicators, the results show a different effect of inequality on growth depending on the level of development of the region. Specifically, we find a negative effect of income and human capital inequality on economic growth, both in the sample as a whole and in the low and middle-income economies, an effect that vanishes or becomes positive in the higher-income countries.


Human capital and income inequality Economic growth Dynamic panel data model