GLOBALIZATION, GROWTH AND INEQUALITY: TESTING CAUSALITY AND ASYMMETRIES
Journal Title: Ekonomicko-manazerske spektrum - Year 2018, Vol 12, Issue 2
Abstract
Interest about income distribution and inequality have substantially grown in recent years. First of all, it can be explained by the increase in inequality as a major threat for the stability of society and economy, that often try to associate with the consequences of the globalization process and slowdown in the global economy. Hence the need for research and constructive discussions on inequality, and its causes. As hypotheses, as a rule, statements are tested: economic growth leads first to an increase, and then to a decrease in inequality; high income differentiation stimulates higher growth rates; the processes of globalization contribute to reducing inequalities in the world. The aim of the empirical part of submitted research is to analyse the relationships between income inequality and economic growth, income inequality and globalisation. The choice of methods to confirm the assumptions was determined by the properties of the long-term relationship between time series of indicators. Study has employed a single-country regression to investigate the existence of the Kuznets curve hypothesis for the Ukraine economy over the period 1995-2016. The bounds testing (ARDL) approach to cointegration is applied to examine the long-run relationship between income inequality and economic growth. The results, when regressing Gini index and GDP per capita based on purchasing power parity, confirm the presence of hidden cointegration. The Granger causality test was applied in order to test the existence of a causal relationship between the degree of globalization and income inequality. For case of Ukraine there is relationship between globalization process and inequality in the long run. Also the causality test revealed some cyclicality, in other words, there is the interchange of one-way direction of causality.
Authors and Affiliations
Juliet Abakumova, Olena Primierova
Keywords
Related Articles
- EP ID EP592449
- DOI 10.26552/ems.2018.2.83-95
- Views 116
- Downloads 0
GLOBAL E-TRENDS IN RUSSIAN HIGH EDUCATION SYSTEM AS ESSENTIAL TOOLS OF ITS CHANGE MANAGEMENT
Modern "post-industrial" era is distinguished by such rapid global changes and almost instantaneous copying of products and services that make it meaningless reaching the goal of long-term retention of a certain market p...
THE SEARCH FOR BALANCE AND EQUILIBRIUM OF NEGOTIATING POWERS UNDER DISTORTED MARKET COMPETITION
Free market economy challenges business negotiations due to occasional distortions in market conditions, which impact the balance of negotiating powers. This is most commonly referred to both buyers and sellers. Reducing...
PRIVATE EQUITY MARKET OF THE VISEGRAD GROUP
Private equity is medium to long-term finance provided in return for an equity stake in potentially high growth unquoted companies. Private equity is capital that is not listed on a public exchange. Private equity is com...
GLOBALIZATION, GROWTH AND INEQUALITY: TESTING CAUSALITY AND ASYMMETRIES
Interest about income distribution and inequality have substantially grown in recent years. First of all, it can be explained by the increase in inequality as a major threat for the stability of society and economy, that...
COMPARATIVE ANALYSIS OF FOREIGN TRADE IN SELECTED EUROPEAN COUNTRIES
Foreign trade plays important role in the economy of every country. It not only solves the proportionality problem and builds the demonstrative effect, but most of all, it supports economic development. This article deal...