EKONOMISK TILLVÄXT OCH INKOMSTOJÄMLIKHET : En komparativ studie mellan Afrika och Europa
Sammanfattning: Growth in a country can be affected by several factors, one of which is income inequality. Increased income inequality can have both negative and positive effects on growth, depending on how developed a geographical area is. This paper examines the connection between economic growth and income inequality in Africa and Europe, through data over the years 1990–2020. Furthermore, the results are compared between these two continents. These two factors, growth and inequality, are included in the UN's 17 global goals. Achieving economic growth and even income distribution are important and essential components for improved living standards. Recent developments show that income inequality between countries decreases, but increases within the countries, which can affect residents in several different ways. In this work, growth refers to the growth rate of the GDP per capita, measured over five-year period and the Gini coefficient is used as a measure of income inequality. In addition to these variables, gross national savings, foreign direct investment, demographic variables and the share of the population having enrolled in upper secondary education have been used to examine the relationship between economic growth and income inequality. To answer this paper’s issue, panel regressions are used, where panel regression with fixed effects is selected as the final model. The results show that income inequality does not have a significant impact on growth in Africa. Income inequality, on the other hand, has a positive effect on growth in Europe. In Africa, the size of the workforce and the proportion of the population who have started post-secondary education contribute to growth. The results obtained in the study are consistent with previous studies in the field especially when it comes to Europe. The work addresses the lack of data in Africa as a possible reason why the connection between growth and inequality in income cannot be identified. The latter problem can be solved by future and further studies on the subject.
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