Growth, Inequality, and Economic Freedom: Evidence from the U.S. States

14 Pages Posted: 30 May 2017

See all articles by Christian Bjørnskov

Christian Bjørnskov

Aarhus University - Department of Economics and Business; Research Institute of Industrial Economics (IFN); Center for Political Studies; Institute for Corruption Studies

Date Written: July 2017

Abstract

This article returns to the discussion of how income inequality affects economic growth. The main argument of the article is that economic freedom is likely to mediate the association between inequality and growth. In a panel of 300 observations from six 5‐year periods across the 50 U.S. states, I employ five different measures of inequality. The results show that across measures, the growth effects of inequality turn more positive with more economic freedom. The moderating effects are mainly driven by measures of public sector consumption.

JEL Classification: O11, O38, O43, P48

Suggested Citation

Bjørnskov, Christian, Growth, Inequality, and Economic Freedom: Evidence from the U.S. States (July 2017). Contemporary Economic Policy, Vol. 35, Issue 3, pp. 518-531, 2017. Available at SSRN: https://ssrn.com/abstract=2976566 or http://dx.doi.org/10.1111/coep.12199

Christian Bjørnskov (Contact Author)

Aarhus University - Department of Economics and Business ( email )

Fuglesangs Allé 4
Aarhus V, DK-8210
Denmark

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden

Center for Political Studies

Landgreven 3
Copenhagen K, DK-1301
Denmark

Institute for Corruption Studies

Stevenson Hall 425
Normal, IL 61790-4200
United States

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