Explaining Inequality the World Round: Cohort Size, Kuznets Curves, and Openness

56 Pages Posted: 2 Oct 1999

See all articles by Matthew Higgins

Matthew Higgins

Independent

Jeffrey G. Williamson

Harvard University - Department of Economics, Laird Bell Professor of Economics, Emeritus; Honorary Fellow, University of Wisconsin - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: June 1999

Abstract

Klaus Deininger and Lyn Squire have recently produced an inequality data base for a panel of countries from the 1960s to the 1990s. We use these data to decompose the sources of inequality into three central parts: the demographic or cohort size effect; the so-called Kuznets Curve or demand effects; and the commitment to globalization or policy effects. We also control for education supply, the so-called natural resource curse and other variables suggested by the literature. While the Kuznets Curve comes out of hiding when the inequality relationship is conditioned by the other two, cohort size seems to be the most important force at work. We resolve the apparent conflict between this macro finding on cohort size and the contrary implications of recent research based on micro data.

JEL Classification: O1, J1, I3

Suggested Citation

Higgins, Matthew and Williamson, Jeffrey G., Explaining Inequality the World Round: Cohort Size, Kuznets Curves, and Openness (June 1999). FRB of New York Staff Report No. 79, Available at SSRN: https://ssrn.com/abstract=173408 or http://dx.doi.org/10.2139/ssrn.173408

Jeffrey G. Williamson

Harvard University - Department of Economics, Laird Bell Professor of Economics, Emeritus ( email )

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