Trade Liberalization and Income Inequality in India: A Poisson Distributed-Lag Analysis
8 Pages Posted: 24 Dec 2008
Date Written: December, 22 2008
This paper addresses the relationship between trade liberalization and income inequality among Indian states using a Poisson distributed-lag analysis. Two measures of income inequality are considered: the Gini coefficient and the coefficient of variation. Trade liberalization is proxied using export growth. Results indicate that there is a different pattern of responses in inequality to export growth between rural and urban households. Rural inequality tends to be more responsive in the hoped-for direction than urban inequality.
Keywords: Trade Liberalization, Income Inequality, Poisson Distributed Lag, India
JEL Classification: D63, F13, F14
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