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Inequality and sustainable development: Insights from an analysis of the human development index

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  • David Castells‐Quintana
  • Vicente Royuela
  • Fabian Thiel

Abstract

In this paper, we connect two lines of research in the development economics literature: the analysis of the effect and transmission channels of inequality on economic development and the discussion about the necessity for a broader measure for development. We estimate the association between income inequality and the Human Development Index and its components in a panel of 117 countries over the period of 1970 to 2010. In doing so, we find evidence for (a) a negative long‐run association between inequality and human development and (b) different short‐run associations between inequality and different dimensions of human development: a positive one with economic development but a negative one with educational outcomes, hinting at particular transmission channels. In addition, we detect (c) that those associations can be even more pronounced in countries with low levels of development, reconciling seemingly conflicting findings in the literature.

Suggested Citation

  • David Castells‐Quintana & Vicente Royuela & Fabian Thiel, 2019. "Inequality and sustainable development: Insights from an analysis of the human development index," Sustainable Development, John Wiley & Sons, Ltd., vol. 27(3), pages 448-460, May.
    • Handle: RePEc:wly:sustdv:v:27:y:2019:i:3:p:448-460
    DOI: 10.1002/sd.1917
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    Cited by:

    1. Claude Bernard Lontchi & Baochen Yang & Yunpeng Su, 2022. "The Mediating Effect of Financial Literacy and the Moderating Role of Social Capital in the Relationship between Financial Inclusion and Sustainable Development in Cameroon," Sustainability, MDPI, vol. 14(22), pages 1-24, November.
    2. Miranda-Lescano, Ronald & Muinelo-Gallo, Leonel & Roca-Sagales, Oriol, 2024. "Human development and inequalities: The importance of social public spending," Structural Change and Economic Dynamics, Elsevier, vol. 69(C), pages 363-377.
    3. Ines A. Ferreira & Rachel M. Gisselquist & Finn Tarp, 2021. "On the impact of inequality on growth, human development, and governance," WIDER Working Paper Series wp-2021-34, World Institute for Development Economic Research (UNU-WIDER).
    4. Anna Dłużewska & Andrea Giampiccoli, 2021. "Enhancing island tourism's local benefits: A proposed community‐based tourism‐oriented general model," Sustainable Development, John Wiley & Sons, Ltd., vol. 29(1), pages 272-283, January.
    5. Wanglin Ma & Puneet Vatsa & Hongyun Zheng & Emmanuel Donkor & Victor Owusu, 2023. "Does Adoption of Information and Communication Technology Reduce Objective and Subjective Well-Being Inequality? Evidence from China," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 169(1), pages 55-77, September.
    6. Julio Vicente Cateia & Luc Savard, 2025. "Trade and distribution in Guinea-Bissau: A computable general equilibrium analysis," International Economics and Economic Policy, Springer, vol. 22(1), pages 1-30, February.
    7. Tang, Yumei & Chen, Xihui Haviour & Sarker, Provash Kumer & Baroudi, Sarra, 2023. "Asymmetric effects of geopolitical risks and uncertainties on green bond markets," Technological Forecasting and Social Change, Elsevier, vol. 189(C).
    8. Btool H. Mohamed & Mustafa Disli & Mohammed bin Saleh Al-Sada & Muammer Koç, 2022. "Investigation on Human Development Needs, Challenges, and Drivers for Transition to Sustainable Development: The Case of Qatar," Sustainability, MDPI, vol. 14(6), pages 1-26, March.
    9. Yang, Zhen & Gao, Weijun & Han, Qing & Qi, Liyan, 2024. "Aggravating or alleviating? Smart city construction and urban inequality in China," Technology in Society, Elsevier, vol. 77(C).
    10. Oscar Claveria, 2024. "Redistribution and human development: evidence from Europe," Economics and Business Letters, Oviedo University Press, vol. 13(2), pages 68-81.
    11. Hunjra, Ahmed Imran & Azam, Muhammad & Bruna, Maria Giuseppina & Verhoeven, Peter & Al-Faryan, Mamdouh Abdulaziz Saleh, 2022. "Sustainable development: The impact of political risk, macroeconomic policy uncertainty and ethnic conflict," International Review of Financial Analysis, Elsevier, vol. 84(C).
    12. Ronald Miranda‐Lescano & Leonel Muinelo‐Gallo & Oriol Roca‐Sagalés, 2023. "Human development and decentralization: The importance of public health expenditure," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 94(1), pages 191-219, March.

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