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The effect of government social spending on income inequality in oecd: a panel data analysis

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  • Ulu, Mustafa Ilker

Abstract

Income inequality is one of the issue which is most discussed and struggled for its solution throughout the history of economics. Since the 1990s, income inequality has increased in most of the OECD (The Organisation for Economic Co-operation and Development) countries as in the whole world. Government social spending is one of the most important means of directly regulating income inequality. This study investigated the effect of goverment social spending on income inequaltiy for 21 OECD countries by analyzing Panel Data. According to the findings obtained, government social spending affect income inequality positively. Income inequality decreases when the government social spending increase. It has been proved that government social spending was more effective than education expenditures in regulating income inequality. It is also understood that unemployment and population growth affected the income inequality negatively. Besides, there is a negative relationship between openness, education expenditures, elderly population, education participation and income inequality.

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  • Ulu, Mustafa Ilker, 2018. "The effect of government social spending on income inequality in oecd: a panel data analysis," MPRA Paper 91104, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:91104
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    References listed on IDEAS

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    Cited by:

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    2. Md Jamil, Abd Rahim & Law, Siong Hook & Khair-Afham, M.S. & Trinugroho, Irwan, 2024. "Financial inclusion and income inequality in developing countries: The role of aging populations," Research in International Business and Finance, Elsevier, vol. 67(PA).
    3. Marina da Silva Sanches & Laura Barbosa de Carvalho, 2023. "Multiplier effects of social protection: a SVAR approach for Brazil," International Review of Applied Economics, Taylor & Francis Journals, vol. 37(1), pages 93-112, January.
    4. Can Verberi & Sema Yasar, 2021. "The Effects of Social Spending on Income Inequality in 30 OECD Countries," Istanbul Journal of Economics-Istanbul Iktisat Dergisi, Istanbul University, Faculty of Economics, vol. 71(1), pages 39-57, June.
    5. Minjong Youn & Chungseo Kang, 2023. "The Role of the Welfare State for NEETs: Exploring the Association Between Public Social Spending and NEET in European Countries," SAGE Open, , vol. 13(3), pages 21582440231, September.

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    More about this item

    Keywords

    Income Inequality; Government Social Spending; Panel Data Analysis;
    All these keywords.

    JEL classification:

    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

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