Income inequality and polity – an empirical analysis of political Kuznets curve

What is it about?

Using the unbalanced panel of 136 countries spanning from 1980 to 2018, we found an inverse U-shaped relation, called a political Kuznets curve – income inequality increases first and then decreases later as more democracy is achieved. By quantifying the curve, we find that the direct impact of democracy on income inequality is small and that the incremental impact of democracy on income inequality is smaller in a semi-democracy while relatively larger in a full democracy and autocracy.

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