Is There Any Optimum Income Distribution in Relation to Government Debt (As % of GDP)? A Note

Abstract:     
In this small paper author makes some comments on the relation between Income Distribution and the Government Debt as a percentage of GDP. It is estimated through a panel data model that optimum Income Distribution takes place at a critical level of Government Debt as a percentage of GDP. Further, it is noted that Economic Growth, Investment and Entrepreneurial activities play a significant role towards a more equal Income Distribution. Finally, the size of the GDP per se does not matter in the improvement of Income Distribution. Our sample covers European Countries during the period 2004 - 2008. Panel data regression analysis will be used based on the Eviews software package.

Number of Pages in PDF File: 12

Keywords: Income Distribution, Government Debt, GDP, Economic Growth, Investment, Entrepreneurship, Social Unrest, Obstacles to Entrepreneurship, Optimization, Econometric models with panel data (single equation)

JEL Classification: C23, F43, G, E21, P1, L26, J5, E22, C61, E4

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