This paper analyses the relationship between income inequality and economic growth through fiscal policy. To this end, we present and estimate two systems of structural equations with error components through which gross income inequality determines different fiscal policy outcomes, which...

The main objective of central banks around the world is the achievement and maintenance of price stability, which actually creates an environment conducive for faster economic growth. Therefore, it is important for policy makers to understand the relationship between inflation and economic...

The empirical evidence on the relationship between income inequality and economic growth is widely recognized and, now, there are rich databases for carry on panel-data type of analyses. However, time series studies for specific countries may be more attractive and yield revealing results. For...

A translog production function and an extended translog production function with third-order terms are estimated for the 50 Spanish provinces in the period 1985–2006. The results show the existence of complementarity relationships between private physical and human capital. Likewise, they show...

The aim of this paper is to empirically identify convergence clubs in per capita incomes of European regions and to investigate whether initial conditions − as suggested by the club convergence hypothesis − are responsible for club formation. To tackle this issue, we propose a two-step...

This paper analyzes the time stability of the GDP beta convergence in two subsamples: EU27 countries during 1993–2010 and EU15 during 1972–2010. Additionally, the article checks for the strength and stability of influence of particular economic growth factors. In order to address the problem...

We examine the effect of energy exports and globalization on economic growth using the bias-corrected least square dummy variable model in a panel of five South Caucasus countries (Azerbaijan, Armenia, Georgia, Russia and Turkey) over the period of 1990–2009. We provide evidence that higher...

This paper examines regional divergence in income across different states in India, and estimates convergence clubs endogenously. The paper makes two useful contributions. First, the data is analyzed using a novel method due to Phillips and Sul (2007) leading to different conclusions in...

Long run convergence implies that the convergence hypothesis will be rejected if the income differential is not stationary. However, this definition is valid only if the catching-up process between the two countries is already over. If we take into account catching-up dynamics, then poorest...

To assist with progress towards the United Nations Millennium Development Goals (MDGs) in developing countries, the international community is scaling-up foreign aid to record levels. Concurrently, there are concerns that additional aid will not be used effectively due to a problem of absorptive...