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Reverse Causal Nexus between Pro‐Poor Policies and Income Inequality in Kenya

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  • Isaiah Juma Maket
  • Izabella Szakálné Kano
  • Zsófia Boglárka Vas

Abstract

Different developing economies are encountering various regional challenges associated with income inequality. However, several contributing factors to inequality and access to opportunities, such as a quality education system, have been identified as the key factors. Thus, the study sought to determine the reverse causal nexus between pro‐poor policies (government spending on education) and income inequality in Kenya and the spatial linking relationship with the case of Uganda’s and Tanzania’s economies. The autoregressive distributed lag (ARDL) model, Johansen cointegration test, and Granger Causality approach were used to model the relationship between pro‐poor policies and income inequality using time‐series data from 1982 to 2018. The findings indicate positive short‐ and long‐term relationships between government spending on education and income inequality in the three economies. Furthermore, the results show a significant long‐term relationship between human capital measures (average years of schooling, secondary school education attainment, and tertiary level education attainment) and income inequality in the three economies. However, the results indicate no reverse causal nexus between the study variables in Kenya and Uganda but unidirectional causal nexus exists in the case of the Tanzanian economy. The study recommends that government stakeholders implement pro‐poor policy initiatives that result in the structural change of social infrastructures and enhanced quality of life. Las diferentes economías en desarrollo se enfrentan a diversos retos regionales relacionados con la desigualdad de ingresos. Sin embargo, se han identificado varios factores como aquellos que contribuyen de forma clave a la desigualdad y al acceso a las oportunidades, como un sistema educativo de calidad. Así pues, el estudio pretendía determinar el nexo causal inverso entre las políticas en favor de los pobres (el gasto público en educación) y la desigualdad de ingresos en Kenia y la relación de vinculación espacial con el caso de las economías de Uganda y Tanzania. Para elaborar un modelo de la relación entre las políticas a favor de los pobres y la desigualdad de ingresos se utilizó el modelo de retardo distribuido autorregresivo (ARDL, por sus siglas en inglés), la prueba de cointegración de Johansen y el enfoque de causalidad de Granger, y se emplearon datos de series temporales desde 1982 hasta 2018. Los resultados indican relaciones positivas a corto y largo plazo entre el gasto público en educación y la desigualdad de ingresos en las tres economías. Además, los resultados muestran una relación significativa a largo plazo entre las medidas de capital humano (promedio de años de escolaridad, nivel de educación secundaria y nivel de educación terciaria) y la desigualdad de ingresos en las tres economías. Sin embargo, los resultados indican que no existe un nexo causal inverso entre las variables del estudio en Kenia y Uganda, pero sí existe un nexo causal unidireccional en el caso de la economía de Tanzania. El estudio recomienda que las partes interesadas del gobierno pongan en marcha iniciativas políticas en favor de los pobres que den lugar a un cambio estructural de las infraestructuras sociales y a una mejora de la calidad de vida. 様々な開発途上国経済が、所得格差に関連する様々な地域的課題に直面している。しかし、格差に寄与する因子や、質の高い教育システムなどの機会を得ることが、重要な因子として特定されている。そこで、本稿では、ケニアにおける貧困層を重視する政策(政府の教育支出)と所得格差の逆の因果関係、ならびにウガンダやタンザニアの経済との空間的つながりを解明する。1982年~2018年までの時系列データを用いて、自己回帰分布ラグモデル、Johansen共和分検定、グレンジャー因果関係検定を用いて、貧困層重視政策と所得格差の関係をモデル化した。結果から、3カ国の教育に対する政府支出と所得格差の間に、短期的にも長期的にもプラスの関連性があることが示された。また、人的資本の指標(平均就学年数、中等教育修了、高等教育修了)と所得格差には、長期的に有意な関連性があることが示された。しかし、ケニアとウガンダの対象の変数の間には逆の因果関係はなかったが、タンザニア経済の場合には片方向の因果関係が存在した。本研究から、政府の利害関係者が、社会インフラの構造的変化と生活の質の向上をもたらす貧困層に配慮した政策イニシアティブを実施することが推奨される。

Suggested Citation

  • Isaiah Juma Maket & Izabella Szakálné Kano & Zsófia Boglárka Vas, 2023. "Reverse Causal Nexus between Pro‐Poor Policies and Income Inequality in Kenya," Regional Science Policy & Practice, Wiley Blackwell, vol. 15(6), pages 1163-1181, August.
  • Handle: RePEc:bla:rgscpp:v:15:y:2023:i:6:p:1163-1181
    DOI: 10.1111/rsp3.12540
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